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A Symposium 


EDITED AND WITH AN INTRODUCTION 
BY 


JEROME DAVIS 


THE CENTURY CoO. 
New York & London 


Copyright, 1926, by 
Tue CENTURY Co. 


Printed in U. S. A. 


To TuHost Empioyers anp Lapor LEapers 
Wuo Dare To Be ExperIMENTAL PIONEERS IN 
CREATING INDUSTRIAL BROTHERHOOD AND TO 
THosE Ministers WuHo Are PRopHETIC IN 
THE SERVICE OF Gop, Darinc To CHALLENGE 
AND REBUKE ExisTING WRONGS. 


INTRODUCTION 


For decades ministers have been trying to tell 
business men what is God’s will for them. Visit the 
shelves of any great university library: there sit the 
sermons, row on row, in lonely and dusty solemnity. 
Nor are they all ancient sermons; among the modern 
variety are One Hundred Best Sermons for Special 
Days and Occasions, Best Sermons 1924, and the 
excellent collection of the sermons of the twenty- 
five foremost American living preachers. 

Is there not a pressing need for a frank and clear 
message from forward-looking business men as to 
what is their own conception of the will of God for 
themselves and for the church? Some people con- 
sider business a pagan institution and feel that the 
man who is called to serve his fellows must of ne- 
cessity enter the ministry or another of the profes- 
sions. What if business is just as sacred a calling 
as religion? 

What can the church do for business and what for 
labor? Perhaps we can reverse the question and ask, 
“What can business and what can labor do for the | 
church?” Perhaps neither can do very much for 
the other, but both can do more than any of us dream 
with each other. 

In order to have an authoritative expression of the 

vil 


Vili Introduction 


relationship of business and labor to the church, 
twenty-one individuals were selected from among 
the outstanding leaders in America. They were asked 
to give the heart of the philosophy or practice which 
they had worked out in the give-and-take of com- 
munity life. The result is a collection of sermons 
and facts from business men and labor leaders which 
have a compelling power far beyond any mere rhet- 
torical effort, no matter how beautiful or sincere. 

The contributions are all the more valuable be- 
cause they represent such a wide variety of opinion. 
It is quite encouraging to find also a central core of 
fundamental agreement running through the chap- 
ters. Apparently there is an overwhelming con- 
sensus of opinion in favor of the supremacy of the 
human side of business. 

A crying need of our time is to get away from 
mere platitudinous idealism to its practical transla- 
tion into the working realm of day-by-day life. Mr. 
Graham Wallas has strikingly illustrated the fact 
that the beautiful theory is often quite valueless. In 
his younger days, as a radical socialist, he became 
involved in a bitter dispute with a business man, who 
suddenly asked, “What is your attitude toward the 
trade-unions?” Not having thought much about the 
subject, he replied that he did not believe in them. 
Instantly the business man extended his hand in 
friendship, saying, “If you and I agree about the 
trade-unions we can get on together.” 

It makes small difference what fine-spun ideals we 


Introduction ix 


profess in the abstract, provided we codperate with | 
the devil in the details of life. The great test of 
our age is whether we can be loyal to the spirit of 
Jesus in our daily community life. It is easy to 
pray about our love for God and sing hymns about 
“My faith looks up to Thee,” but it is hard to ad- 
venture with God in the realm of the commonplace, 
seven days a week. Our task as Christians is to * 
make concrete the Christ way. This means that we 
must translate our loyalty into our daily performance 
record; our actual achievement must come near to 
our theoretical standard. 

But how can we apply our loyalties? What is the 
relationship of business and the church to the process? 
Is it not possible that the will to exploit may have 
such a bewitching appearance that we shall mistake it 
for the will to serve? What is the duty of the em- 
ployer? If he should pay adequate wages, what is 
adequate? These and other questions are convinc- 
ingly answered from different points of view in this 
volume. 

There are those who think it impossible to get 
the employer and the worker together in conference. 
Here, at any rate, they are bound together, and he 
who reads may judge as to the relative merits of 
their respective standards and policies. Sermons may 
come and sermons may go, but business practice goes 
steadily on. How far are pagan actions in the com- 


mercial and financial world imperative? Is it not). 


high time that we really try to Christianize business? 


x Introduction 


In the action of some of those whose contributions 
are given here there is a loyalty to the Jesus way 
which no amount of talking can ever accomplish. 
If science and religion have anything to teach us, 
it is that new situations demand new methods. All 
honor to the brave group of those who are making 
their business accord with their ideal as they see it. 
' It is no exaggeration to say that a large number 
of the following articles ought to be read by every 
minister in America. Hundreds of business men 
will find in them more stimulus for the perplexing 
tasks of the world than a great deal of generalized 
beauty regarding love, justice, and mercy. 

The editor desires to express his deep appreciation 
to the men who have contributed to this volume. 
Many of them are among the busiest executives in 
the world, and to do this added service has meant 
literally taking time out of a rare and precious recre- 
ational period. It is hardly necessary to add that 
no contributor is responsible for any opinion ex- 
pressed herein except his own. To the students of 
Yale Divinity School the editor is also in debt for 
their interest in the project. Without the incentive 
which came from a class on industrial relations, it 
would never have been compiled. Thanks are also 
due to Miss Caroline B. Parker of The Century Co. 
for her assistance in reading proof and preparing 
some of the biographical sketches. 


Jerome Davis. 


CONTENTS 


» “SociaL Justice” anv CuristTiAn IpEauism . 


John Calder 


Tue NeEeEp oF SoctAL BLUEPRINTS . 


Henry Ford 


Do Prayinc Fatuers Have Preyinc Sons? —No! 


Roger W. Babson 


How THE CuurcH Can Arp Inpustry . 


E. M. Herr 


Wuart Can THE CHURCH Do For Lasor? . 


William Green 
THE WorkKER AND THE CHURCH . 
Whiting Williams 
REPRESENTATION IN INDUSTRY 


John D. Rockefeller, Jr. 


Tue PsycHoLocy oF EMPLoYERs . 
Sam A. Lewisohn 


REsEARCH IN INDUSTRY 


A. H. Young 


Wuat THE Minister Can Do Wiru Lazonr 


Albert F. Coyle 


xi 


PAGE 


35 


57 


71 


81 


101 


115 


131 


155 


xil Contents 


Workinc WitH Lapor IN THE EvLEctrIcaL INDustTRY . 


L. K. Comstock 


A CoépPERATIVE INDUSTRIAL EXPERIMENT 
Henry Dennison 


Tue Human SipE oF PRoDUCTION . 


J. M. Larkin 


Tue Eruics oF SELLING . 


Harry R. Tosdal 


Busrness AS A Factor IN PRoGREss 


Edward A. Filene 


An ExpERIMENT IN InpusTRIAL DEMocRACY . 


A. D.N. Holt 


Inpustry AND Human Nature . 


William P. Hapgood 


CodpERATIVE MANAGEMENT WiTH THE Lazor-UNIon 
Benjamin M. Squires 


EMPLOYEE REPRESENTATION To-pay . 


John W. Riegel 


Tur OrcanizED CHURCH AND ORGANIZED LABoR 


Arthur Nash 


Wuat Facts SHoULD THE CHURCH KNow ABOUT In- 


DUSTRY? . .. 


Earl Dean Howard 


Wuat tHe Cuyurcu Expects oF THE BUSINESS Man . 


Jerome Davis 


PAGE 


169 


191 


207 


225 


253 


271 


287 


301 


317 


333 


347 


359 


“SOCIAL JUSTICE” AND CHRISTIAN 
IDEALISM 


JOHN CALDER 


ConsuLTING ENGINEER 


Mr. Calder was trained in the steel industry of Scotland and 
is an honor graduate of the Royal Technical College. For 
twenty-five years he managed well known American plants, in- 
cluding those of the Remington Typewriter Company and the 
Cadillac Motor Car Company. He acquired a national reputa- 
tion in labor management and was called to be the first manager 
of industrial relations of Swift & Company with more than one 
hundred plants. There, during several years, he developed 
policies and made a marked success of employee representation, 
of the organization and education of foremen and executives, 
and of personnel services. He is now in practice as a consultant. 
He has been a welcome contributor to The Irom Age and is an 
active member of the American Society of Mechanical Engineers, 
the Society of Industrial Engineers, and other professional bodies. 
His recent book, Capital’s Duty to the Wage Earner, covering 
the whole field of industrial relations, has attracted wide attention 
as a constructive and illuminating contribution by a forward- 
looking, practical man. 

Mr, Calder has given generously of his time and abilities to 
church work. He is chairman of the Social Relations Commis- 
sion of the National Council of Congregational Churches, which 
has just promulgated a “Statement of Social Ideals” more prac- 
tical and forward-looking than any pronouncement by the 
churches hitherto issued. Mr. Calder devoted six months of his 
time solely to carrying the statement over ten thousand miles to 
the Christians, business men, and students of fifteen States, 


BUSINESS AND THE 
CHURCH 


“SOCIAL JUSTICE” AND CHRISTIAN 
IDEALISM 


Joun CALDER 


Justice is the rarest of human virtues; in a long life I 
have met ten generous men for one just man. 
Wituiam Ewart GLapsToneE. 


“Social Justice” is a sententious phrase favored by 
orators and much used—sometimes overworked— 
by a few editors, authors, politicians, labor leaders, 
demagogues, social workers, and preachers; the rest 
of us are discreetly silent about it in seven languages. 

Like the much abused concept “patriotism,” social 
justice has varied all the way from a noble passion 
to a moral lunacy, and, like it too, it has sometimes 
been “the last refuge of a scoundrel.” Edith Cavell’s 
dying message to patriots shedding blood and tears, 
“Patriotism is not enough,’ is already bearing 
fruit upon her grave. It is the purpose of this essay) ; 
to assert that social justice, even were it attainable, — 

3 


4. Business and the Church 


is also not enough; to prove it, and to show “ a more 
excellent way,” “which is hid with Christ in God.” 

The phrase is rarely used by representatives of 
capital, who say, “It is not in our lives or on our 
ledgers; we have no acceptable definition of it; no 
quantitative idea about it and measuring-rod.”_ On 
these points capitalism is frank and too complacent, 
while reforming persons are voluble and too con- 
fident—and sometimes shallow; and the rest of us 
care for none of these things and ask for a comfort- 
ing formula and peace—where there can be no peace 
except that of sympathy and understanding. 

Nevertheless we all have a qualitative concept of 
social justice, and we know quite well what we 
mean when we use the phrase. To many people 
it signifies, “a bad time had by all,” and acting on 
‘their motto, “safety first,” they carefully embalm it 
and lay it away among other ideals suffering from 
suspended animation. But there are honest souls— 
sometimes poorly equipped—and Christian con- 
sciences that will not down, who brave all the un- 
pleasant names and contumely which society and our 
hundred-and-twenty-per-cent Americanism levels at 
the inquisitive in social affairs. In spite of deliberate 
prosecution, and even persecution, of opinion and 
inquiry to-day, and despite inefficient research and 
immature conclusions, we know now why social justice 
is not enough. 

Our troubles about the concept of social justice, 
and the unwarranted hopes regarding the social 


“Social Justice” and Christian Idealism 5 


miracles it might effect, arise chiefly out of the pas- 
sionate convictions about it of earnest, worthy people 
who indulge in bad thinking or, even when they pro- 


ceed by quite logical processes, exercise their minds | * 


around insufficient or faulty premises. | 

There are many historical instances of such errors, 
some of them by people who were “the salt of the 
earth.” Though not widely held, one of the most 
persistent social fallacies has been the deterministic 
theory known as Marx’s economic interpretation of 
history, which consisted of a passionate, most ex- 
haustive, and fairly true indictment of the capitalism 
of his day and an imposing assembly of unpleasant 
industrial and social facts and their consequences 
in the England in which he had taken refuge from 
the repressive German Government. To his theory 
of a new social order he tacked on highly theoretical 
views of the future of democracy and uttered dire 
prophecies—almost apocalyptic in their tenor— 
which the verdicts of history ever since have progres- 
sively falsified. That theory is still the theoretical 
underpinning of conduct among aggressive minorities 
in Russia and elsewhere who dwell in doubtful joy. 
Meanwhile, the socializing of various human en- 
deavors and organizations has steadily progressed, 
but not to the catastrophic deterministic climax which 
Marx proclaimed was the inevitable end of the Euro- 
pean civilizations he saw in the eighteen-seventies. 
Things have not been all for the worse in the worst 
of all possible worlds, as he predicted and even 


6 Business and the Church 


hoped; for his Utopia predicated great gloom before 
its dawn. 

The truth is that men gain nothing whatever by 
pretending that life is simpler than it really is, and 
Marx’s great generalization did not cover all the 
facts and did not solve all the difficulties caused 
by these facts. Life is not either black or white. 
It is varying shades of gray, and there is no use in 
selecting dreadful examples to represent the whole, 
as Marx did. Society cannot be redeemed, as he 
thought, by a formula, and though socialism as an 
ideal will always threaten illiberal, reactionary 
capitalism and worry the slackers and lazy-minded 
who are at ease without desert,—lest a worse thing 
befall them,—society is not static, but dynamic, be- 
coming, not being, and changing with the years, their 
advancing knowledge and experience, and reflection 
on these. How is it that so many people get off the 
track about social justice? It is chiefly through as- 
suming as self-evident truths two propositions that 
are in fact highly questionable. First of all, men err 
by assuming that an absolutely just distribution of 
wealth is possible and that such an objective should 
be and is a completely satisfactory end of social en- 
deavor. To such people amy society or social order 
stands condemned if the distribution of its wealth 
or illth is not “absolutely just.” 

In the second place such people make another false 
assumption; viz., that justice is al] that can be or 
should be expected of social institutions. These two 


“Social Justice” and Christian Idealism 7 


errors can be found in many countries and in many 
different guises to-day, motivating and activating all | 
sorts and conditions of plans—wise and otherwise— 
for changing the social order, and they reveal serious 
misunderstandings of the deeper meanings of the 
principle of justice. They are a direct result of 
the tendency to deem just only those arrangements 
or consequences which appeal to the sentiment of the 
individual. “Justice” to him becomes synonymous 
with “right,” a right of course which he intuitively 
perceives and hence finds agreeable to his moral 
sentiment. Under the glow of emotion, and pre- 
cisely because he identifies “justice” with what he 
feels to be “right,” the sentimentalist comes to re- 
gard “abstract justice” as the chief good and, with 
reference to social arrangements, all that man could 
desire. 

We know well that in the material world dis- 
tributive justice can never be absolutely certain. All 
appraisals are subject to error. The valuation of our 
social services, labor, and products is so uncertain 
and liable to rapid change that the exact contribu- 
tion of the individual to the joint product is usually 
unknown and unknowable, and without certainty we 
cannot effect the justice predicated by purely senti- | 
mental verdicts. On the other hand, action in the 
moral as distinguished from the economic realm is 
more closely related to the eternal verities, and justice 
is realizable in the moral life. The almost mathe- 
matical justice of a Greek tragedy wins our assent; 


8 Business and the Church 


the poetic justice of the Bible, Shakspere, and other 
literary immortals moves our hearts and minds to 
approbation; but no such clear and determinable 
issue is presented in the industrial and business world, 
in which we codperate in what we call getting a living, 
and around which gather all our economic conflicts 
over lack of “scarcity values.” What are we going to 
do about this situation? Well, we can accept it; or 
we can denounce it and wholly repudiate it and seek 
to divorce ourselves from responsibility; or we can 
apply ourselves to wmprove it. I am of the fellow- 
ship of the #mprovers, and I am prepared to give 
reasons for the faith that isin me. But first of all I 
wish to make two affirmations. Without pessimism 
and without despair, first I assert that no conceivable 
form of society will ever achieve any large measure 
of idealistic justice in the distribution of wealth on 
this planet, and secondly, if it could, it would not of 
itself make life more worth living, as some con- 
fidently believe. 


A man’s reach should exceed his grasp or what’s a heaven 
for? 


How near: then can we get to the ideal in the 
material sphere, while hugging perfectibility to our 
hearts as a hope in the moral one? What is the 
measure of the height and breadth and depth of the 
possibilities where “we live and move and have our 
being,” our fears and hopes, our likes and hates? 
What, in a word, is the just significance to society in 


“Social Justice” and Christian Idealism 9 


all of his potentialities of just one man out of the 
billion and a half in the world to-day? What is he 
actually worth to the rest of us in goods and services 
—in doing, thinking, and being—in the broadest 
sense? I think it may be set forth briefly in the 
following six propositions which progressively ad- 
vance the standard of achievement: 

(1) The value of a man—the totality of all his 
qualities—in action—is eguwal to his produc- 
tion minus his consumption. 

(2) When his production is less than his con- 
sumption, he has no “value”; he is, in vary- 
ing degrees, just a social parasite. 

(3) When his production eguals his consumption, 
he merely justifies his existence. 

(4) When his production exceeds his consump- 
tion, he is an economic success. 

(5) When his economic success is devoted to 
things which strengthen and uplift himself 
and his community, he is @ social success. 

(6) When each man’s acquisition is equal to his 
production, justice has been attained. This 
attainment is at once the task of a society 
or a state and the test of its quality. 

But the constant tendency of man is to make justice 
depend upon sentiment rather than upon his deserts 
as just outlined. That which is intuitively agreeable, 
morally pleasing, and obviously liberal is a snare 
from time to time alike to the public, capital, and 
labor and is labeled aright by one or another—some- 


10 Business and the Church 


times by all of them—with no attempt at the more 
difficult task of due measurement of the merits of 
the individuals or groups involved. Collectivism, for 
instance, often runs riot in unfairness, in cheap ap- 
proximations, or in careless generosities, whose func- 
tion is chiefly to please. To please whom? Some- 
times a dominant, unscrupulous minority, liberal or 
conservative, in business, labor, politics, and even 
the church; at other times it may be a complacent 
majority; and often a public uninformed or ill-in- 
formed and unthinking. It is the easiest way out 
of controversy. But injustices about labor, capital, 
or the public, whether to minorities or majorities, 
cannot be offset. They do not cancel out. 

We must have the will to “prove all things,” if 
we would “hold fast that which is good.” And this 
involves a virile, active mind and a genuine love for 
the truth about things, a quality not too common. 
‘Practical morality, not heady sentimentality, the 
greed of tyranny, or the pride of benevolent autoc- 
racy, is the sure compass of the economic and every 
other social adventure. The unanimity of a “com- 
mittee of the whole,” of captain, crew, and pas- 
sengers, about the social course to be set is no guar- 
antee in itself that we shall sail in the right direction. 
Only through showing a decent respect for the ac- 
cumulated experience of the race can we achieve an 
acceptable measure of social justice; generous in- 
tentions are not enough. 

Many religious people have no forward social 


“Social Justice” and Christian Idealism 11 


look. They are worried when religion touches men 
where they live. Such people are conservative in 
their attitude toward all existing institutions, accept 
them as they are, ask no questions, have no doubts, 
and yield them loyal and unquestioning obedience. 
The victory of their political, industrial, or social 
party or their church is the form in which their own 
personality finds most complete and satisfactory ex- 
pression. They neither make issues nor raise them; 
they simply vote with their crowd and look upon 
all who differ as outsiders. Truth and justice are 
unmeaning terms to these lazy, docile people—often 
of excellent personal character; but what a life! 
Our congregations are well stocked with them, and 
they covet like-minded spiritual guides, whose re- 
ception of our social ideals has been warm, if not 
cordial. Other religious persons, some of whom 
have a keen sense of truth and beauty, revolt at the 
mean compromises which organized society indulges 
in and invites from them. These are lonely souls 
who find their inner freedom impaired. They re- 
fuse to pay the price of conformity for peace, and 
they rebel and withdraw, sometimes into an un- 
social mysticism, and sometimes in their self-centered 
individualism they make God and the Soul all that 
their religion is concerned with for practical pur- 
poses; they are virtually out of the world. But! 
there are those who “follow the Gleam” wherever 
it leads them, by whom religious truth both new and 
old is welcomed and its implications made practicable. 


12 Business and the Church 


They have learned from Jesus that God is love and 
that loving is the only practicable way of living. 
They sympathize with those who love to have the 
same allegiance and obedience, they agree with those 
who are disgruntled with existing society, but they 
part company here with both; for “This Freedom” 
which they claim for themselves they are quite will- 
ing to grant to all others; and they let knowledge 
grow from more to more. With Voltaire they can 
say to the rebel, “I disapprove of all you say; but 
I will fight to the death for your right to say it.” 
They do not think they possess the whole truth or 
that they can ever attain it by themselves. 

Candid critics of current civilization, they are not 
despondent about its longer future. They believe 
that they can shorten the time, and they ask nothing 
better than to join in the effort to improve con- 
ditions. It is they and kindred spirits who make 
social justice impossible in the material realm, for 
while they will freely yield, they will not insist 
upon receiving all of their rights, every time, about 
everything. And it is likewise with “the husband- 
man that laboreth”; he too, when he likes his task- 
master or employer, is not insistent upon the joy or 
tittle of his legal right. Absolute and even approx- 
imate justice is often defeated by the “love that 
makes the world go round,” and Jesus is its ex- 
emplar, its origin, and its climax. 

No others are touched to such fine issues as are the 
devoted followers of the Nazarene, and they and all 


‘Social Justice” and Christian Idealism 13 


men to-day who feel and think and act truly in our 
workaday world must make men while they make 
things and frame policies and direct or influence hu- 
man beings. We must reflect upon the “greater 
things” which Jesus said we would do, for “the wise 
man can understand the foolish because he has been 
foolish; but the foolish cannot understand the wise, 
because he has never been wise.”” We are reminded 
of an old Greek tale that relates how a strange mon- 
ster having the body of a lion, the wings of a great 
bird, and the head of a woman sat beside the road 
that ran to the city of Thebes and presented a riddle 
to every one who passed that way. This riddle-~ 
woman-animal was called the Sphinx, the squeezer, 
the tightener, for she enwrapped and devoured every 
one who could not answer her riddle, but was herself 
doomed to perish the moment the true answer was 
given. We know from legend the reign of the 
Sphinx terror in Thebes and the long list of the dead. 
We do not wonder that the throne itself was offered 
to any one who would destroy the Sphinx by a true 
guess of her riddle; at long last, a man, C&dipus, 
guessed it and became king to a grateful people. 
Here is the riddle: “What creature is it that goes on 
four feet in the morning, on two at noon, and on 
three in the evening?” In answer CE&dipus cried 
out: “Man! Man! Man! For in the morning he 
creeps on all fours; in the noontide of life he walks 
upright on two strong feet; in the evening he limps 
along with a staff.” 


14 Business and the Church 


On the roadways of their experience all nations 
have found their Sphinxes seated, propounding rid- 
dles—about social justice chiefly—and causing con- 
sternation and destruction to the ignorant. Take 
the United States alone, at three great epochs. In 
1776 their Sphinx on the road of destiny asked, 
“How can you free yourself from a foreign yoke?” 
And a Washington answered, “Man! Man! Man!” 
and became our guide to liberty. In the early sixties 
of the nineteenth century our Sphinx asked, “Can 
this nation exist half slave and half free?” Anda 
Lincoln cried out, “Man! Man! Man!” and led us, 
though divided among ourselves, to victory. 

In 1917 our Sphinx was sitting at the wayside 
again asking, “Can we sit at home in safety and see 
freedom strangled abroad?” And again the answer 
came, “Man! Man! Man!” this time from a hun- 
dred million throats, and the taunting Sphinx per- 
ished. But in 1926 another Sphinx propounds a 
* new and harder riddle, a riddle that we must answer 
truly if free government here and all over the world 
is to survive, namely, “How are the masses of men 
and women to be taught to labor with their hands 
and brains willingly and efficiently so as to secure 
out of the products of their toil and thought what 
they feel to be, and what will be in fact, a fair 
return?” 

Until we can answer this latest Sphinx at our 
own doors we shall have no peace, and if we fail 


“Social Justice” and Christian Idealism 15 


to answer it, we shall have a revolution. It is not 
a question that America faces alone; others are in 
much more serious case. Britain faces it frankly 
and bravely; France faces it most unwillingly and 
delays; Italy and Spain tremble before it, ask to be 
excused, and enjoy the mean security of temporary 
dictators who cannot answer the Sphinx; and Russia 
gave the wrong answer—a mixture of fallacy, false- 
hood, fanaticism, and fear of true democracy, 
mingled, alas! with intriguing and worthy social 
aspirations—and was torn to pieces, for the Sphinx is 
merciless to untruth. Must we despair like her? 
Be foolish to be wise at great price? Commit evil 
that good may come? Is there a deliverer? Yes. 
Is there balm in Gilead? Yes! Is there a physician 


there? Yes! I believe the answer to the Sphinx »* 


is still the same: “Man! Man! Man!” that the 
remedy consists in believing in, proclaiming, and up- 
holding the dignity, the honesty, and, in these days 
particularly, the intelligence of man; so that he may 
use his self-determination and self-expression with 
all the knowledge acquirable; with things old and 
precious and things new and revealing. The rid- 
dle, after all, is the problem of approximating social 
justice, and how rich and meaningless it has become 
since Plato entreated men to think to some purpose 
about their social action; since Isaiah and Amos and 
Micah flamed out on social injustice; since Jesus 
rebuked man’s inhumanity to man, which makes 


16 Business and the Church 


countless thousands mourn, and revealed the secret 
of “the earthly paradise”—His “kingdom come—on 
earth.” “The quality of mercy is not strained”; 
neither is the quality of justice. And earthly love 
‘is likest God’s “when mercy seasons justice.” The 
Christian thinker, ranging freely among the plain 
evils of our time, echoes Voltaire’s defense of free- 
dom of speech already cited: “I disapprove of all 
you say; but I will fight to the death for your right 
to say it.” The Christian liver denounces all prose- 
cution and persecution of opinion. He demands so- 
cial justice for his fellow-man, but refuses it for 
himself, as his Master did. Christian idealism is 
ereater than even justice; for pure religion and 
undefiled before God and the Father in the twen- 
tieth century is producing true democrats—givers 
not getters; and true democracy—responsibility 
widely shared, not equally shared, but each accord- 
ing to his ability, and the ablest of character, benev- 
olence, and endowment taxed to the utmost of his 
powers to serve us all. Make no mistake about it! 
Weare on the eve of a great revival of and by and for 
laymen; you can hear it “on the air” any day. Young 
men and maidens, old men and matrons are realiz- 
ing increasingly that ultimately we are what we love 
and care for, and that no limit has been set to what 
we may become without ceasing to be ourselves; 
and “flaming youth” wants to be a glorious self. 

Let two poets give us their doubtful joy and in- 
finite hope about justice: 


“Social Justice” and Christian Idealism 17 


Thou madest man: he knows not why! 
He feels he was not made to die; 


And Thou hast made him: Thou art just. 


Grow old along with me; the best is yet to be 

The last of life, for which the first was planned. 

Our times are in his hand who saith, “A whole I planned”; 
Youth shows but half; trust God: see all: nor be afraid! 


je 


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é ‘tule ny rit fs ' 


ts Ged 
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‘ay J 


Sad yey 

if At iv nals vs by 

Ath aaa 
: { ee i 


THE NEED OF SOCIAL BLUE-PRINTS 


HENRY FORD 
A Practica, Mystic 


Mr. Ford, with only a common-school education and the 
knowledge of a machinist’s trade, has by his vision, coupled with 
a marvelous ability to simplify, organize, and standardize indus- 
try, done more to revolutionize the condition of the worker than 
any other man of our time. 

Justice and not charity is the basis of his relationship with his 
employees. He pays sufficient wages to make them independent. 
He was the first man in this country to demonstrate that good 
wages bring profit. 

He has developed a “vertical trust” extending from the raw 
ore in the depths of the earth, over a railroad transportation 
system, and ending in millions of throbbing automobiles; yet all 
this great network of industry is a single efficient mechanism. 

There is not a passable road in the world that is not traversed 
by Mr. Ford’s cars; his ships are on the seas, his planes in the air, 
He has turned the sylvan city of Detroit into a hive of industry 
and has made it an ocean shipping port, for he is sending boats 
to Rio and the Argentine. 

The University of Michigan has just conferred on Mr. Ford 
the degree of doctor of engineering, the first, by the way, that he 
would accept. This honor was given in recognition of his ma- 
terial contribution to social welfare and his constructive imag- 
ination in the field of industry. The citation described Mr. 
Ford as a man “whose genius brought into being an industry that 
changed the world. Endowed with vision to create, courage to 
persevere, wisdom to plan and execute, capacity to achieve, he 
has interpreted business in far-reaching terms of organization 
and coérdination.” 


THE NEED OF SOCIAL BLUE-PRINITS | 


Henry Forp 


Most of the things which people say they see, 
are actually seen. There is no imagination about it. 
The pessimist who sees things going to pieces is not 
deluded; he is correctly reporting what he actually 
sees. The optimist who sees things soaring up to 
the height of perfection is an equally good reporter; 
he is not fooling us or himself; he sees what he 
says he sees. 

But the trouble is, too many people are doing all 
their seeing within too narrow limits, and while their 
reports of what they see are true, they are not com- 
prehensive. There is nothing more likely to be 
misleading than a field of vision so narrow as to leave 
out part of the points. It is like seeing the elephant 
in so limited a way as to report only his tail or 
tusks. The animal appears quite differently in a 
comprehensive view. 

Now all this has an important application to the 
state of mind in which many people find themselves 
to-day. There are perhaps more minds focused on 
economic problems than ever before, more people 
thinking, or perhaps it is more truthful to say they 

2I 


22, Business and the Church 


are wondering, about the conditions which have be- 
fallen human affairs. 

It is probably true that though we are all looking 
and wondering, we do not see very much as yet; 
but it is still a mighty fact that the minds of the 
people are focused on their affairs. Formerly we 
left it all to the government or destiny; but now the 
governments have failed us, and destiny is not a 
thing to take without codperation. And there is a 
millionfold more chance of seeing when we are 
looking than when we are not. That is the attitude 
of people to-day; they are looking, and presently 
they will see. 

Some people see certain things going to pieces. 
They see correctly. Certain established customs, 
methods, processes, institutions, traditions, which we 
have been accustomed to lean upon, are undoubtedly 
going to pieces, and they are going to pieces irre- 
coverably too. 

It is that last element, the irrecoverability, that 
strikes fear to many people. They thought that 
“normalcy” meant the recovery of the old things, 
the reéstablishment of the old way, the restora- 
tion of the old habitual leaning-posts. Most peo- 
ple thought of “normalcy” in that way, as yester- 
day come back. But yesterday is not coming back. 

The old world is dead, dead, dead. It is beyond 
recovery. God himself will not restore it, and Satan 
can not. 

That is the a-b-c of the new alphabet; namely, 


The Need of Social Blue-Prints 23 


the old world is dead. Not dying, but dead. The 
things you see going to pieces are its funeral, its 
decay. 

If people would only learn this a-b-c, it would 
save them from a great deal of confusion. But the 
point is this: those who say that everything they see 
is going to pieces, are telling the truth, because their 
eyes are focused on the things which belonged to 
the old era. The old era is dead and is being buried 
bit by bit. Every day another fragment of it falls 
into dust. 

Now if that is a/J that you see,—and it will be all 
that you see if it is all that you look for,—no wonder 
you have the feeling that everything is going to 
pieces. 

But if you turn around and see what is coming 
swiftly up behind your back, as you gaze appre- 
hensively into the past, you will get the other half 
of the field of vision; you will see the things that 
are to be. 

Perhaps you have seen the oak take color in com- 
pany with other trees in the autumn. Then came 
the rains, and the other trees let go their leaves; not 
so the oak; only a few did he let fall. Then came 
the winds, and the branches of the other trees were 
left ragged; but the oak held most of his leatfage. 
Then came the frost, and all the trees were stripped 
clean and bare of leaves; but the oak leaves shriv- 
eled a bit and took on the tone of old cordovan 
leather, but for the most part clung to the parent 


24 Business and the Church 


boughs. They are a cheering sight in winter, those 
shriveled leaves that defied the frosts of autumn; 
they are a cheering sight as they defy the winter’s 
snow and blast. Then winter begins to wane, and 
spring is a promise in the air, and green things begin 
to appear; but still the oak holds tenaciously to last 
year’s foliage. AQ little later and the leaves begin 
to fall—in spring. If you had not looked around 
upon the earth to see what else was happening there, 
if you did not know what compensating work was 
being done, you might well think that at last every 
leaf in the world was about to go. 

But this is the fact: the leaves that stayed longest, 
that we had learned to associate with stability, those 
are the leaves that fall before the new leaves appear. 

In the social order, is it not our seemingly most 
strongly established things that are beginning to flut- 
ter down? Are not the most solidly essential ser- 
vices the ones that are now most under doom? Cer- 
tainly, as any one who focuses his vision only on the 
passing things will tell you. It is the collapse of 
the most dominant methods and institutions that 
alarms most people. Well, it need not alarm any 
one. When the leaves of the strongest tree fall, 


spring is here. If you will widen your field of | 


vision, you will soon see other things springing up to 
take the place of that which is passing. 

So you have a choice. You can sit and look at 
the fading out of all that made the old normalcy, 
and you can wail about calamity to come; or you 


The Need of Social Blue-Prints 25 


can stand up and watch the new era come in, look- 
ing for your place in its ranks. If you do the lat- 
ter, you will see an entirely different state of facts. 
It will not be imagination, or mental suggestion, or 
the foolish mysticism of pretending things are all 
right whether they are or not; it will be fact— 
the thing is true, the new era zs here. 

A business man in a small town said it all very 
well the other day. Said he: “I just try to accus- 
tom myself to the thought that I have waked up 
in a new world. I don’t know just what kind of 
world it is going to be, but I know it is my duty 
to keep on the watch to find out so that I may be 
ready for it. I know there is going to be a new way 
of salesmanship, and I am trying to find out what it 
is. I know I shall have to keep wider awake, and I 
am trying to find out on what lines. I am in a new 
world and I have got to learn about it all over again. 
The only things that have carried across from the old 
world into the new are Service and Honesty—but 
you can drop the ‘Honesty’ and save time, for when 
you say ‘Service’ you say it all.” 

That is the attitude! That man was awake to 
the fact that the new era is here; he wanted to be 
alert in all his senses when it tried to teach him 
something. He says he hasn’t learned much yet, 
but he has learned the basic thing, without which 
he could not learn anything at all: he has learned 
that the world is new. If that plain fact could be 
dinned into people’s heads and hearts, so that even 


26 Business and the Church 


without understanding it completely it could be- 
come the time-beat of their thinking, a great deal 
would have been accomplished. 

Certainly many things are going to pieces. They 
ought to! And if you look at them long enough 
you may get the impression that everything is going 
to pieces. You should turn around and look the 
other way and see the New Era marching up the 
side of the hill. Then you will see that although 
the ruin of all our own stupid, inefficient, unjust, 
and unproductive methods is unavoidable and good, 
the real cause of their disappearance is the New 
Era which is pushing them out. While you are 
looking, be sure and see it all. 

Almost any one you may chance to meet will 
tell you that “something ought to be done” and will 
assure you that it must be done very soon. But you 
will travel a long way before you will meet any 
one with a plan that has a single point of practic- 
ability. 

Many plans, so called, are not plans at all; they 
are pleasant pictures of conditions as they may be 
after all the planning, all the preparatory work, 
and all the constructive labors are done. A plan is 
not an oil-painting of a complete object; a plan in- 
dicates the “how” and the “where” and the “what” 
of every joist, joint, and pillar. You cannot build 
a house from a charming photograph; you will need 
a blue-print. 


The Need of Social Blue-Prints 2d. 


Every thoughtful man has an idea of what ought 
to be; but what the world is waiting for is a social 
and economic blue-print. 

There is something deadly exact about a blue- 
print. It is not a speech; it is not a propaganda; it 
is not a burst of enthusiasm; it is a simple thing 
of lines and signs which tells you what to do and 
just where to do it. It speaks of only one quality— 
orderly work. Now this is why good intentions 
are of so little value to the practical solution of the 
problems that confront us. Good intentions, of 
course, are very good—as intentions. And doubt- 
less good intentions must exist in every good plan. 
But every one has had enough experience with well- 
meaning people to know that good intentions are 
often sterile. 

It is very surprising to learn how much of the 
distrust of people in plans for the advancement of 
justice in human relations is due to the failure of 
so many ill-planned and badly managed good inten- 
tions. Human history is full of the wreckage of 
high and noble intentions for social good and human 
betterment, which failed simply because they had 
the visionary quality without the creative quality. 

And one result of this is the almost universal as- 
sumption that whatever is good, generous, just, and 
warmly human is prevented by those very qualities 
from being practical. There is an unspoken belief 
that if a plan is to be practical, it must disregard hu- 


28 Business and the Church 


manity to a greater or less extent. Consideration of 
others and success for one’s self are believed to be 
incompatible. 

Another result is the assumption that “creative 
work” can only be undertaken in the realm of vision. 
We speak of “creative artists” in music, painting, 
and the other arts. We thus limit the creative func- 
tions to productions that may be hung on gallery 
walls or played in concert halls or otherwise dis- 
played where idle and fastidious people gather to 
admire each other’s show of “culture.” 

But if a man wants a field for real vital creative 
work, let him come where he is dealing with higher 
laws than those of sound or line or color; let him 
come where he may deal with the very laws of per- 
sonality and society. Creative work! We want artists 
in industrial relationships. We want masters in 
industrial method, from the standpoints of both the 
producer and the product. We want those who can 
mold the political, social, industrial, and moral mass 
into a sound and shapely whole. 

We have limited the creative faculty too much 
and have used it for too trivial ends. We want men 
who can create the working design for all that is 
right and good and desirable in our life together 
here: 

Now it is pretty clear that the creative plan, when 
it comes, will propose surprisingly little that is new; 
it will consist largely in a readjustment of the old 
things. 


The Need of Social Blue-Prints 29 


We shall not outgrow the need to work. Some 
people are talking as if the “good time coming”? is 
going to eliminate labor altogether. Some people 
appear to think that the only thing that is wrong 
with our present system is that people have to work 
for their living. 

Well, we may be sure on one point: work is not 
what ails the world. The world would be infi- 
nitely worse off than it is, both physically and mor- 
ally, if it were not for work. One of the danger 
spots of the present time is that so many men are 
trying to evade work as if it were a disease. There 
is a class of men who regard the white collar as a 
sign of emancipation from work. An idea like that, 
if true, would soon bring the white collar into dis- 
grace. 

There are too many men dickering in real estate 
and not enough men digging in it. 

There are too many agitators, who do not work 
at all, telling these groups who cannot think for 


- themselves that they are to be commiserated because 


they have to work. 

Think of it! here in America, the one country 
in the world where it has always been held hon- 
orable that a man should work with his hands—in 
this country honest work is sought to be made the 
badge of servility! 

Say what you will, the man who works with his 
hands has the best of it, other things being equal. 
And what we all want in this country is that the 


30 Business and the Church 


working-man shall have the best of it all around. 
This cannot be done by abolishing work, for work 
cannot be abolished; but it can be done by abolish- 
ing those limitations and false practices which have 
kept from the worker the reward which ought to 
be his. 

Profit-sharing, additional annual bonuses, stock- 
sharing, and dividends, a close and sympathetic in- 
terchange of counsel between the production and 
management parts of the business,—or, to state it 
another way, between the strictly business and strictly 
human aspects,—these constitute a promising begin- 
ning. ‘The human part must serve the business part, 
else there would be no great center of useful work 
which would provide the living of all employed 
there; yet the business part must also serve the hu- 
man part, else the service which the business can ren- 
der to human well-being would be cut in half. 

The principle which must become clear to the 
mind of this and the coming generation is that good 
intentions, plus well thought out working designs, 
can be put into practice and can be made to succeed. 

There is nothing’ inherently impossible in plans 
to increase the well-being of the working-man. 

If there has seemed to be, it is only because the 
world has heretofore thrown all of its thought and 
energy into selfish schemes for personal profits. 

If the world will give as much attention and in- 
terest and energy to the making of plans that will 
profit the other fellow, such plans can be established 


The Need of Social Blue-Prints 31 


on just as practical a basis as the others were—with 
this additional advantage: the latter kind of plan 
will last longer than the other kind, and will be 
far more profitable both in human and financial 
values. 

What this generation needs is a deep faith, a 
profound conviction in the practicability of right- 
eousness, justice, and humanity in industry. 

If we cannot have these qualities, then we were 
better off without industry. Indeed, if we cannot 
get those qualities, the days of industry are num- 
bered. But we can get them. We are getting them. 

There will come men whose highest joy will be 
to diffuse benefits instead of accumulating heaps of 
personal profits which they will never use. There 
will come a race of men to whom money will mean 
only the opportunity to develop still bigger benefits 
for the men and their families who carry the world 
on their shoulders. 

If selfishness can only be curbed, if the long-range 
values can only be shown in their desirable lights, 
if men who are in authority could only see the wis- 
dom of exchanging the low gratifications of mere 
gain for the finer gratifications of human service, 
why, then there would be no end to what might be 
done. 

The good only is practicable. Anything less 
than that is not only impracticable in any sense what- 
soever, but it is vanishing too. 


‘ y a aik 
2 9 
ON TMV ee Ate 


Mahaer he 


DO PRAYING FATHERS HAVE PREY- 
ING SONS? NO! 


ROGER W. BABSON 
PrEsIDENT, THE Basson StTaTisTIcCAL COMMUNITY 


When Roger Babson was a youngster his juvenile enthusiasm 
was always kindled by a contest of any sort—particularly if he 
were directly involved in it. “I always enjoyed a good scrap,” 
he admits. 

In this statement is contained the secret of much of Mr. 
Babson’s success in life, because it has been this willingness to 
meet and overcome handicaps which would have daunted a less 
determined man that has been one of his outstanding char- 
acteristics. 

Mr. Babson’s early studies convinced him that Isaac Newton’s 
famous law of equal reaction in the world of physics applied 
with equal force in the field of economics. It was upon this 
theory of action and reaction that he erected the huge economic 
structure—the largest statistical organization in the world—which 
to-day holds a position of preéminence in business circles, 

With this service to the business interests of the country se- 
curely established, Mr. Babson determined to make a permanent 
contribution to the public service by making it possible for busi- 
ness executives to be trained for the profession of business in a 
strictly scientific manner. To this end he established seven years 
ago the Babson Institute, a scientific school of business. For 
the past three years the Institute has been located on its new 
campus of 175 acres with buildings already erected which repre- 
sent a cost of more than a million dollars. An endowment is 
rapidly accumulating which will enable special research and 
clinic work in economics to be done later. 

Behind all this lies the vision of Roger W. Babson. He is a 
man with a far look ahead. And there is much yet to be done. 
He is working toward the day when the Statistical Community 
at Babson Park, Massachusetts, will serve the business and eco- 
nomic world as the International Institute of Agriculture at Rome 
serves the agricultural world. His plans envision a world clinic 
on business and economic problems constantly at work trying to 
serve mankind. 


DO PRAYING FATHERS HAVE PREYING 
SONS? NO! 


Rocer W. Basson 


Do praying fathers have preyimg sons? Yes, if 
you believe in proverbs. Most emphatically no, if 
you prefer statistics. Like ninety per cent of the 
proverbial wisdom, the folk-lore jibe at ministers’ 
sons and deacons’ daughters breaks down completely 
under the penetrating rays of recorded facts. As 
an introduction to these facts let me explain that 
when speaking of the offspring of the church I am 
thinking not merely of clergymen. There are pray- 
ing fathers among farmers, carpenters, bankers, 
merchants, manufacturers, and other laymen, whose 
lives are deeply influenced by prayer and religion. 
The minister’s family gives us a convenient case for 
discussion because here we have the spiritual element 
most fully expressed. One, however, should never 
forget that real religion will pulse as strongly 
throughout the pastorate of the church as in the 
parsonage itself. 

Let the facts array themselves for appraisal. We 
approach the subject in two steps: first, eminence in 
general; and second, eminence in business. De Can- 
dolle, the scientist, was among the early explorers 

35 


36 Business and the Church 


in this field. More than twenty-five years ago he 
examined the lists of eminent men and scruti- 
nized their parentage. He discovered a marked 
predominance of ministers’? sons in the world’s 
Hall of Fame, and an overwhelming percentage 
as representing those brought up in the church. 
In commenting upon this tendency, a religious 
journal recently published the following significant 
summary: 


For more than 200 years clergymen’s sons have out- 
numbered all others in their contributions to science. 
Among those were Agassiz, Encke, Euler, Linnzus, and 
Olbers. To this more recently has been added the name of 
Dr. Robert Andrews Millikan. Among philosophers and 
historians who were ministers’ sons were Hallam, Hobbes, 
Emerson, Sismondi, and a long list equally well known. 

Ministers’ sons who became ministers include Jonathan 
Edwards, Archbishop Whately, Robert Hall, Lightfoot, the 
Wesleys, Lowth, Stillingfleet, the Beechers, and the Spur- 
geons. Poets whose fathers were ministers include Young, 
Cowper, Thomson, Coleridge, Montgomery, Heber, Ten- 
nyson, Lowell, while in the field of literature are also Swift, 
Lockhart, Macaulay, Sterne, Hazlitt, Thackeray, Bancroft, 
Emerson, Holmes, Kingsley, Matthew Arnold, and 
Stephen Crane. 

There may be included as an architect, Sir Christopher 
Wren; as an artist, Sir Joshua Reynolds, and among heroic 
characters, Lord Nelson. Nor are the daughters of clergy- 
men overlooked in this list, which contains the names of 
Mrs. Trollope, Mrs. Barbauld, Jane Taylor, the Brontés, 
and Harriet Beecher Stowe. 


Do Praying Fathers Have Preying Sons? 37 


Again we have a demonstration of the general 
eminence of ministers’? sons in the following sur- 
vey, credited to Bishop Edwin H. Hughes of the 
Methodist Episcopal Church: 

There have been three preachers’ boys in the 
White House. 

Nine of the signers of the Declaration of Inde- 
pendence were sons of ministers. 

Five Supreme Court judges and many governors, 
in addition to a great list of lesser political officials, 
were products of manses. 

Daughters of preachers have been mistresses of 
the White House during seven presidential terms. 

The Democratic party never elected a Presiden- 
tial candidate who was not the son of a minister. 

The Wright brothers, pioneers of aviation, were 
manse products, and the first transatlantic flight was 
made by the son of a preacher. 

The inventor of the telegraph, Samuel Morse, 
was a pastor’s son. 

In the Hall of Fame are listed names of twelve 
preachers’ sons. 

Yet these are merely high spots regarding min- 
isters of the church. When one examines the in- 
fluence of the church itself, the evidence is most 
conclusive. Probably 85 per cent of the world’s 
leading scientists and statesmen will credit their suc- 
cess to the Christian training of the home and the 
church. 

A professor at Indiana University, Stephen S. 


38 Business and the Church 


Visher, prefaces a volume of “Who’s Who” with an 
analysis of the twenty-five thousand notable Ameri- 
cans listed therein. One of the purposes of this 
analysis was to find out the proportion of eminent 
people whose fathers were clergymen. The fathers 
were classified into groups, such as physicians, clergy- 
men, attorneys, laborers, and farmers. The data in- 
dicated that preachers, in proportion to their num- 
bers, fathered more than two thousand times as 
many prominent people as did the least favored 
group, namely, the laborers. As fathers of famed 
offspring, the preachers surpassed the farmers thirty- 
fold, surpassed the business men fivefold, and sur- 
passed any other group twofold. In other words, so 
far as the conditions of this particular test are con- 
clusive, the preacher shows a clear superiority as 
the progenitor of the famous. 

When Professor Visher’s analysis came to my at- 
tention, my first question was this: This criterion is 
fame—and fame largely in the arts, letters, sciences, 
or politics. If the measurement were changed to 
financial or industrial achievement, would the re- 
sults be essentially different? Do the notable men 
in the realm of business likewise trace their origin 
to fathers and mothers of unmistakable piety? Is 
the early influence of prayer and religion a power 
in all kinds of success? 

That is the question with which this chapter is 
primarily concerned. 

In this connection we have a singular research 


Do Praying Fathers Have Preying Sons? 39 


made by that master lecturer, the late Russell H. 
Conwell. He investigated the parentage of about 
four thousand American millionaires. I cannot say 
that all these parents of the wealthy were clergy- 
men; but according to Conwell’s findings, all but a 
handful of these thousands of millionaires began 
life as poor boys with the church as their training 
center. The pardonable surmise is that many of 
them were preachers’ boys. A correlative research 
of the records of rich men’s sons showed that scarcely 
one in twenty died in affluence. The poor boy with 
the stimulus of his early church training rises to 
riches, while the rich boy, feeling sufficient unto 
himself, sinks to poverty; this is the summary of 
the evidence. 

Why should this be so? What is the magic of 
humble Christian circumstances in early life, and 
what is the ill omen of the silver spoon? My ob- 
servation has been that children born and brought 
up in the households of ministers, and other earnest 
Christian parents in similar situation, learn certain 
fundamental lessons of life. They develop a desire 
to produce because they are not surrounded with the 
countless ministrations of wealth. The ministers’ 
sons make their own playthings, and the deacons’ 
daughters make their own clothes. The whole en- 
vironment is one of service. If Professor James 
was right in saying that the character sets like plas- 
ter, the characteristics of integrity, industry, thrift, 
and service thus acquired in youth are almost a guar- 


40 Business and the Church 


antee of achievement in maturity. Though I have 
no statistics to offer on this, I can say that I have 
yet to meet a financial or industrial leader of the 
first rank who is not conspicuous along these lines. 
These qualities are so dominant in such men that 
even in trifles they are often amusingly apparent. 
The millionaire himself is rarely the one who in- 
stinctively loves to be waited on; he himself usually 
detests it at heart; it is his family who revel in 
luxury. 

Reliance, however, as early learned by the chil- 
dren of clergymen and other disciples of plain living 
and high thinking, is more than reliance on self. 
« The vicissitudes that attend a family of limited means 
inevitably foster a wholesome sense of life’s prob- 
lems and uncertainties. The lesson that “life is not 
a bed of roses, but a battle-field” inspires a lasting 
desire for divine help and guidance among these 
perplexities and severities. Children of this environ- 
ment therefore learn to depend upon themselves 
rather than upon others; but above self-dependence 
they learn even more firmly a dependence upon 
superior power and wisdom. 

It is just the opposite with the boys and girls who 
are insulated by their parents? riches from any full 
contact with the struggles of earning a living. Hence 
we have the peculiar paradox that the offspring of 
the most worldly have the least knowledge of the 
real world. Instead of self-reliance they learn self- 
complacency and self-sufficiency, and this false edu- 


Do Praying Fathers Have Preying Sons? 41 


cation tends to blind them permanently to man’s 
need of God. Into the fight to achieve, a man or 
woman can carry no handicap more deadly than self- 
satisfaction and a disregard of God. No other 
qualification for success can offset a lack of this prime 
essential; neither ethical integrity, nor indefatigable 
industry, nor sagacity, nor anything else—nothing 
can take its place. 

I wonder whether it is necessary to remark that 
in many instances the children of clergymen and 
others are brought up unwisely and turn out badly. 
In many instances, the children of the wealthy are 
brought up unwisely and turn out badly. In many 
instances, the children of the wealthy are brought up 
wisely and turn out well. Such cases by their com- 
parative rarity excite remark and gain a false prom- 
inence in the public imagination. Statistics, how- 
ever, cannot be concerned with these unusual items 
except to the meager extent that they may affect 
the average. These statistics show that the ideal con- 
dition for bringing up children is a Christian home 
in humble circumstances. Poverty alone is not suffi- 
cient. Culture of itself is of little avail; but the 
two combined in a Christian home make the ideal 
conditions. 

From the facts which I have already presented 
and attempted to interpret, there seemed to be 
little doubt that the early church influence of prayer 
and sane religion is a priceless heritage and almost 
indispensable if the possessor is seeking success in 


42 Business and the Church 


business. Therefore, not to discover a new idea, 
but rather to corroborate a truth already firmly es- 
tablished, I wrote to many of the country’s great 
business leaders. Supplementing this correspondence 
with numerous personal interviews, I must have gath- 
ered information from a large group of men, each 
of whom is a recognized power in his industry or 
locality. The group comprises a condensed, but rep- 
resentative ““Who’s Who in American Industry and 
Finance.” ‘The questions which I put to these men 
obtained information about their parents, whether 
their parents relied on prayer and were essentially 
religious. Care was taken to make the inquiry in 
such a manner that the man felt no compulsion to 
answer in the affirmative from purely filial motives. 
I believe that the response was entirely spontaneous 
and trustworthy. 

The data thus compiled is remarkable in its una- 
nimity. Many of these men very kindly gave me 
signed statements setting forth the facts explicitly. 
They seemed to welcome an opportunity to put 
themselves on record. Others spoke to me person- 
ally with an earnestness that left no doubt of the 
depth of their feeling. A very few did not care 
to participate in the inquiry, but even here I be- 
lieve we may usually infer reserve and reticence 
rather than any real negative. In all, there is at 
hand indisputable evidence that men of major im- 
portance in the business world owe their origin to 
praying fathers and mothers. 


Do Praying Fathers Have Preying Sons? 43 


Moreover, I ventured to extend the inquiry to 
the man’s own life. I find that men of this type 
do not leave all the praying to their parents. They 
themselves, almost without exception, avow faith in 
Deity and continue the habit of prayer which they 
learned in youth. I wish that the results of this 
inquiry could be embodied in a phrase sufficiently 
simple and impressive to become a part of the ac- 
cumulated wisdom of the world. 

Here are the questions which I addressed to these 
leaders in business and finance: 

(1) Did you have a praying father, a praying 
mother, or both? 

(2) Do you believe there is some Power higher 
than the human power? 

(3) Do you feel that we are responsible to this 

Higher Power? 

(4) Do you feel we need help from it? 

(5) Do you ever pray? 

(6) Has this feeling of responsibility influenced your 
life? 

Among those whom I have interrogated on the 
above points, there have been included chairmen of 
the boards of directors, presidents, and others of 
chief authority in the following lines: 

Food industries 
Commercial banks 
General finance 
Investment bankers 
Public utilities 


44 Business and the Church 


Iron and steel industries 
Mining industry 

‘Trust companies 
Steamship lines 
Railroads 

Newspapers 

Lumber industries 
Telegraph companies 
Chemical industries 
Hotels 

Department stores 
Printing industries 
Copper industries 

Oil industries 
Mail-order industries 
Farm-implement industries 
Dry goods 

Automotive industries 
Telephone companies 
Electrical industries 


I endeavored to address only leaders in their re- 
spective lines and to divide the group into the twenty- 
five above mentioned industries. 

About the facts, there can be no question. It is 
demonstrable that the early influences of the church 
and praying parents are forerunners of the son’s 
career in business, and that the son’s own prayer 
and religion are at the root of his success. That 
much is known. When we seek the reason and ex- 
planation of this truth, there is opportunity for much 
debate. To simplify the discussion let us fix our 


OO EE 


Do Praying Fathers Have Preying Sons? 45 


attention upon the minister’s household, taking this 
as representative of innumerable other godly fam- 
ilies. 

The sons and daughters of ministers or of other 
praying parents have the industry, thrift, practica- 
bility, and balance of the mother. Combined with 
these qualities they have the vision, faith, and spir- 
itual fire of the father. This combination, cemented 
with integrity, is the foundation of the successful 
business career. What are the characteristics of the 
big man in business? They include integrity, indus- 
try, initiative, inspiration—precisely those qualities 
which he would get in a typical old-time New Eng- 
land minister’s family or in the home of a sane and 
serious church worker. I repeat that a humble home 
tempered with culture and inspired with religion 
makes the strongest men and women. 

Jerome Davis asks why it is that, with such train- 
ing, ministers’ sons sometimes seem themselves to 
lose interest in the church and to lack the social 
vision and the social sense of responsibility. The 
answer to this question is seen best in the parable of 
the sower. The seeds are indeed sown, and they 
often come up, but they are choked off by the cares 
and troubles of the world. For any high degree of 
success, most men feel that they can be absorbed in 
but one thing. Business unfortunately calls for this 
intense absorption and the concentrating of all the 
energies into a single focus. There is also another 
reason why some of the big business men, who have 


46 Business and the Church 


unmistakable spiritual force, may appear not to give 
an adequate expression of that spiritual force in their 
own business. It is wholly impossible to judge any 
business from the outside and to say what can 
or what can not be accomplished. ‘Take the purely 
mechanical side, for example. To you and me it may 
seem the easiest thing in the world for a manufac- 
turer to make some trifling improvement in his prod- 
uct. It seems, from our inexperienced point of 
view, that he must be very stupid or selfish not to 
make this slight change. We little realize that some 
alteration which seems nothing at all may require 
the throwing away of a most costly equipment of 
automatic machinery and the scrapping of thousands 
of dollars’ worth of tools and other equipment. 
Sometimes the addition of a seemingly infinitesimal 
amount to the cost of a product may total a sum 
running into the millions, because of the tremendous 
volume of output. These mechanical examples are 
perfectly obvious when we stop to think of them, but 
what is not so clearly seen is the similar situation 
that controls the economics of business. 

Economic forces have a power which the public 
never realizes, because such forces are rarely spectac- 
ular. Nevertheless, the business man is strictly sub- 
ject to their control. He can no more avoid or alter 
economic laws than he can make water run uphill or 
act in defiance of any law of physics, mechanics, or 
chemistry. To you and me, watching from a distance 
some towering figure of finance and industry, it may 


Do Praying Fathers Have Preying Sons? 47 


appear to us that this man can do what he pleases. 
Nothing could be farther from the facts. His every 
act is strictly limited and conditioned by the economic 
environment in which he operates. The kindliest 
mathematician cannot make two and two other than 
four, nor can the most spiritual leader of business 
reverse or revise the laws of economics. 

Moreover, it is increasingly the case that the in- 
dividual business is no longer an isolated unity. Time 
and again a business man may wish to make some 
change in his own particular organization, but he 
realizes that such a policy will have far-reaching 
reactions not merely upon other concerns in his own 
line, but also upon other industries. Business is 
steadily becoming like a vast mechanism. Every 
wheel, lever, pipe, and other part of this great ma- 
chine has a connection with every other element. By 
an almost mechanical necessity any change in one con- 
cern makes its effect felt throughout the entire struc- 
ture. Looking at a single enterprise it is easy to 
say, “Why doesn’t that company adopt a different 
labor policy or so and so?” Doubtless that one com- 
pany desires to make the suggested change, but unless 
the same policy were extended throughout the entire 
industry or throughout all industries, the upheaval 
would be most disastrous and more innocent people 
would be hurt by the change than by continuing the 
unsatisfactory conditions. 

Let me repeat this point. The construction and 
operation of business is more intricate and extensive 


48 Business and the Church 


than the most complicated machine you ever saw. 
College professors and other well-meaning people 
who would hesitate to tell a designer where and how 
to place his cams, rods, and pinions should be equally 
slow to tell an experienced business man how to 
handle his labor. Particularly remember this: In- 
dustry as a whole may raise wages or may reduce 
working hours, or may alter a product, and not 
much may happen; but if any one concern raises 
wages or reduces hours, it is likely to mean bank- 
ruptcy, and unemployment for the workers. We 
must have a better world by the adoption of the bet- 
ter standards for which labor leaders and social 
workers are striving, but these changes must come 
about gradually as the hearts of both employers and 
workers are changed. 

When I stress the fact that the great men of busi- 
ness have mostly been brought up in the church, 
please do not get the idea that I say that they are all 
saints. I do not even say that their parents who were 
active in religious work were very much better than 
millions who do not take an active interest. A man 
may love and be kind to birds without belonging to 
the Ornithological Society. Moreover, most of us 
had rather live and, in many ways, do business with 
those who have not so much “religion.” I fear 
every man has one or more sins, and women, I pre- 
sume, would be catalogued accordingly if all the facts 
were known. Surely, because a man has the religious 
emotions is no reason why he has a 100 per cent 


a 


Do Praying Fathers Have Preying Sons? 49 


record on the Ten Commandments. There are many 
instances where such men are far better posted on 
the multiplication table. 

However, the fact nevertheless remains that there 
is something in the church environment and religious 
impulses which develops in men a desire to create 
and a joy in production. Education dresses up the 
surface of a man, but there is a “something” found 
in the church which provides the impelling force and 
makes him anxious to be of service. In other words, 
although religion is no proof of virtue, it does de- 
velop men to do things and creates within them a 
fund of energy. Whether they secure this through 
prayer, faith, or the desire to be of service, I do 
not know; but statistics show very clearly that these 
men have a power which others have not. 

Before closing this chapter, let me state that this 
is not an appeal for church attendance; neither am 
I starting a drive for greater church membership. Of 
all detestable things, I think hypocrisy is the great- 
est. The man who joins the church or joins a lodge 
to help him in business is nothing short of a skunk. 
To use such an institution to help him socially or to 
aid him in selling goods is almost an unpardonable 
sin. Therefore I hope no one who reads this article 
will go to church in order to be a bigger business 
man. The basic principle of Christianity was ex- 
pressed by Jesus in the statement: “He that findeth 
his life shall lose it; and he that loseth his life for 
my sake shall find it.’ This means that spiritual 


50 Business and the Church 


power comes not by going after it, but as a reaction 
from sacrifice and service. The man who goes into 
religious work to get something never gets anywhere. 
Those who have acquired spiritual power, with which 
they have created big things, became interested in 
religious work unconsciously and never from any sel- 
fish motive. This is especially important for the 
young man to understand. 

Of course, a great many people are religious whom 
we never hear from; but so far as I know, every 
man who has been a real creator of things worth 
while has been impelled by spiritual power. For 
instance, take any of the best known businesses of 
to-day. Start out with the United States Steel Cor- 
poration, for instance. James A. Farrell, its presi- 
dent, is a most devout Roman Catholic. If you 
talk with him, he will tell you that he owes his posi- 
tion to-day to the power, faith, and inspiration which 
his religion has given him. The great packers, the 
Swifts, are intensely religious men. Mr. Louis F. 
Swift supports Lake Forest College, an institution 
for preparing young men for the Presbyterian min- 
istry, while his brother is engaged in similar work. 
The McCormicks, of harvesting machinery fame, 
founded a great theological school. Mr, Henry P. 
Crowell, head of the Quaker Oats Company, has for 
years been the head of the Moody Bible School of 
Chicago, while the vice-president, Mr. J. H. Doug- 
las, and his wife have been very active in Chicago 
religious work. George Horace Lorimer of the Sat- 


Do Praying Fathers Have Preying Sons? 51 


urday Evening Post—starting in business under 
Philip Armour—is the only son of a Baptist min- 
ister, and his father’s picture is always on his desk. 
One more reference to Chicago: Mr. Victor Lawson, 
late publisher of the Chicago Daily News, has re- 
cently left a fortune to the trustees of the Chicago 
Theological Seminary, which trains men for the Con- 
gregational ministry. As stated above, these men 
may not have been saints, and probably some read- 
ers will shrug their shoulders when I mention their 
names; but I am not endeavoring to prove them to 
be saints. My statement is not that spirituality makes 
men good, but rather that it makes men strong. 
There may be many collars that are as good as 
Arrow collars, many breakfast foods that are as good 
as Toasted Corn Flakes, several paints that are as 
good as Sherwin-Williams, and soap which is as 
pure as Ivory. However, these other collars, break- 
fast foods, paints, and soaps are not so well known, 
while the brands I mention are known in every 
household. Why? The reader can be his own 
judge, but the facts show that in every one of these 
instances, the founders of the business were intensely 
religious men and went about the selling of their 
products as missionaries, fired with an indescribable 
zeal. Mr. Cluett, of Cluett, Peabody & Company, 
has been president of the Young Men’s Christian 
Association of Troy for many years; Kellogg is 
probably the leading Seventh-Day Baptist in this 
country. The Sherwins are active Episcopalians and 


52 Business and the Church 


Baptists, and their general manager is superintendent 
of the Old Stone Presbyterian Sunday-school in 
Cleveland. I remember one winter when in Florida 
I was talking with Mr. Procter of Procter & Gamble, 
the manufacturers of Ivory soap. I tried to talk 
with him regarding the business situation, but no, 
that was not what was interesting to him. He im- 
mediately turned the tables and endeavored to in- 
terest me in the work of the International Young 
Men’s Christian Association. This was the one great 
thing he had on his mind. It seemed to be an over- 
powering passion with him. I have had scores of 
instances like this when talking with captains of in- 
dustry. 

Of course, no one sect or denomination has a mo- 
nopoly of spiritual power. The bottles may be la- 
beled Presbyterian, Methodist, Roman Catholic, or 
even Jewish, and the colors of the liquid inside may 
differ; but there is spiritual power in all of the bot- 
tles. Mr. Rosenwald, the head of Sears, Roebuck 
& Company, is a Jew, but is just as religious a man 
as was Wanamaker, the great New York merchant, 
so active in Christian circles. The Colgates of Col- 
gate Soap fame, Herbert D. Kingsbury, Duke’s part- 
ner in the American Tobacco Company, and N. W. 
Ayer, the founder of the great advertising agency, 
Heinz, who made the 57 Varieties, and scores of 
other men have testified to me the facts which I am 
trying to present. All that I ask is that the reader get 
me right. I believe that religion should be a sign of 


Do Praying Fathers Have Preying Sons? 53 


goodness, virtue, and gentleness; but I know it is a 
generator of power. 

In conclusion I have only this to add. It has been 
my experience that one of the most useful ways to 
test the validity of any belief is to assert it in pub- 
lic. I do not know why it is, but there seem to be 
millions of hawk-eyed critics scattered throughout 
the country who spend their entire working lives 
watching for flaws of writers and speakers. Broad- 
cast any statement of sufficient importance, whether 
by platform, press, or radio, and if so much as a 
single comma is misplaced, your mail will be choked 
the following morning with letters pointing out 
where you were wrong. My final test, therefore, of 
the validity of this idea, is that I have repeatedly 
and publicly challenged any one to refute it. I 
recall that many years ago when addressing a mass- 
meeting in New York City, I stated that the over- 
whelming majority of successful men have been 
brought up in a Sunday-school with a praying father 
or a praying mother, that they themselves are funda- 
mentally religious, and that the church was the basis 
of their success. I have made these same challeng- 
ing remarks from many other platforms throughout 
the country. It has been widely circulated by news- 
papers and magazines, but through all this wide- 
spread and prolonged ordeal the statement has stood 
unchanged. 

In fact, much to my surprise at first, I have re- 
ceived letters not of criticism, but of confirmation. 


54 Business and the Church 


For years I have been thus periodically searching 
and canvassing for evidence on the opposite side of 
the case, for any bit of testimony from the mil- 
lions of business men, which might change my posi- 
tion. With so many true things in the world to 
cherish, I do not want to cling to any illusion. Be- 
cause of this simple and practical but actually very 
rigorous testing of the statement, I can very confi- 
_ dently go on record once again here in this book 
with the declaration that prayer and religion, as de- 
veloped by our churches, are the foundations of 
achievement, al] achievement and not merely achieve- 
ment among pastors and poets, but also achievement 
in one of the toughest battle-grounds of the ages, 
the arena of modern American business. 


ee 


HOW THE CHURCH CAN AID 
INDUSTRY 


EDWIN MUSSER HERR 


PRESIDENT, WESTINGHOUSE ELECTRIC AND MANUFACTURING 
CoMPANY 


Mr. Herr was educated in the public schools, but before com- 
pleting his high school course he was compelled to go to work. 
Having been employed at odd times as a messenger by the West- 
ern Union Telegraph Company, he became interested in teleg- 
raphy, and by the time he was sixteen he was able to secure a 
position as telegraph operator in the Denver office of the Western 
Union company. He employed his spare time to such good ad- 
vantage in continuing his studies that in 1881 he was able to 
enter the Sheffield Scientific School of Yale University. 

After graduation in 1884 with the degree of Ph. B., he en- 
tered the office of the mechanical engineer of the Chicago, 
Burlington & Quincy Railroad at Aurora, Illinois, as mechanical 
draftsman, and through successive promotions became engineer 
of tests, superintendent of telegraph, and finally division super- 
intendent of that road. He accepted other important positions 
with outstanding companies, and studied railroad practice both 
here and abroad. 

In 1896, during a series of air-brake tests conducted on the 
Burlington Railroad before the Master Car Builders’ Association, 
Mr. Herr first met Mr. George Westinghouse. He evidently 
impressed the great inventor most favorably, for in 1898 he was 
asked to accept the position of general manager of the Westing- 
house Air Brake Company, located in Wilmerding, Pennsyl- 
vania. Mr. Herr remained with this company until 1905, when 
he was elected first vice-president of the Westinghouse Electric 
& Manufacturing Company. In 1911 was elected president. 

Under his management, the Westinghouse Electric & Manu- 
facturing Company has grown from a comparatively small con- 
cern, handling $20,000,000 of business annually, to one of the 
outstanding companies in the world with an annual business of 
approximately $160,000,000. 

He is a director of the American Manufacturers’ Export Asso- 
ciation, Radio Corporation of America, Westinghouse Air Brake 
Company, Westinghouse Electric & Manufacturing Company, 
and various other organizations. 


: 


HOW THE CHURCH CAN AID INDUSTRY 
E. M. Herr 


One of the most difficult problems confronting in- 
dustry to-day lies in the relationship between the 
management and the workers. 

In the early days of industry when an employer 
knew all parts of his business intimately and had per- 
sonal contact with his employees individually, this 
problem was not a serious one. Grievances on the 
part of either the employer or the employee could 
be discussed personally and satisfactory adjustments 
promptly made, while employers who habitually 
treated their employees harshly paid the penalty of 
being shunned by competent help. 

To-day, however, the rapid development and im- 
provement of the steam-engine and the application 
of electricity for supplying light, heat, and power 
have enabled manufacturing industries to grow until 
thousands of people are employed by a singie com- 
pany where formerly hundreds were employed. 
These large industrial units—usually in the form 
of stock companies or corporations—require a well 
organized body of employees led by one executive 
who, because of the size and nature of the organiza- 
tion, is far removed from the workmen, so called; 

57 


58 Business and the Church 


that is, the men who work more with their hands 
than with their heads. These workmen are by far 
the largest group of people employed in any given 
industry, and to their proper management is being 
directed more study and effort than to any other 
single problem in industry. 

It is here that the interests of the church and of 
industry meet. Industry is primarily interested in 
efficient production and the church in human wel- 
fare, but their interests are, in the last analysis, 
largely identical, in spite of all that has been said and 
written to the contrary. If industry and the church 
work together, each with a clear understanding of 
the problems and aims of the other, the result will 
be better and happier men and women, which is the 
true objective of all human effort. 

I have referred to the very large industrial estab- 
lishments of to-day and to the large number of 
workmen employed by them. It is a fact, however, 
that less than one third of the wage-earners of the 
country are employed by these large companies, and 
they themselves in the aggregate comprise but one 
per cent of the total number of manufacturers. These 
facts should be remembered if a true picture of the 
situation is to be had; but that there is a distinct 
trend toward larger industrial companies can not be 
denied, and a consideration of the effect of this 
change upon the workers is therefore important. 

In the early stages of growth of these large manu- 
facturing units, as the responsible manager was un- 


How the Church Can Aid Industry 59 


able to have personal contact with the workmen, em- 
ployees were often dealt with rather arbitrarily, caus- 
ing them to feel the need for an organization among 
themselves by means of which they could cope with 
the employing organization, or, as it is usually called, 
the management. In forming an organization, the 
workmen not only included the employees of a single 
company, but brought into it all the workmen of a 
similar craft, regardless of their location. This con- 
stituted a union, and thus we have the machinists’ 
union, the carpenters’ union, the miners’ union, etc. 

Owing largely to lack of contact with the really 
responsible officers and to the absence, to a greater or 
less extent, of codperative effort between manage- 
ment and men until rather recently, there were fre- 
quent clashes, which too often resulted in strikes or 
lockouts. About ten years ago progressive managers 
began making an effort to get into closer contact with 
their workmen and to this end encouraged the forma- 
tion of committees of workmen in each manufactur- 
ing plant, who could meet jointly with the foremen 
and other executives and discuss matters of mutual 
interest. Through the meetings of these so-called 
joint conference committees, each side obtained a 
broader and more correct view of the other’s prob- 
lems and conditions, and they were thus enabled to 
reach agreements which would otherwise have been 
impossible. 

The number of joint conference committees or 
works councils in various American industries is rap- 


60 Business and the Church 


idly increasing. In 1919 about two hundred were 
reported, while in 1924 there were more than eigh- 
teen hundred affecting a million and a quarter 
workers, or about one tenth of those employed in 
manufacturing industries. 

These committees are elected by the workmen by 
ballot in such a way as to make them representative 
bodies; that is, each elected member represents a 
group or a certain number of employees, and these 
members are elected at regular intervals, usually an- 
nually, so that they are at all times the real choice 
of the employees they represent. The group of em- 
ployees elected by the workmen joins a group of 
employees appointed by the responsible officials of 
the company, usually composed of foremen, assis- 
tant foremen, chief clerks, storekeepers, and other 
minor officials, with whom the representatives of the 
workmen come in contact in their daily duties and 
with whom they are more or less acquainted. The 
representatives of the management sit with the rep- 
resentatives elected by the workmen and together 
form the joint conference committee. 

Does this joint conference committee fairly re- 
place the former personal contact between the re- 
sponsible head of the business and the employees 
working under his direction? 

Before attempting to answer this question, it 
should be understood that a modern manufacturing 
industry is no longer owned in a large measure by 
those responsible for its management, as was the case 


How the Church Can Aid Industry 61 


a generation or two ago. The ownership of a mod- 
ern industry is spread among many thousands of 
stockholders; in the case of two of the largest cor- 
porations the number of stockholders has increased 
in the last twenty years from less than ten thousand 
to over three hundred thousand. It is becoming in- 
creasingly true, therefore, that in the case of our most 
important industries, no large amount of stock is 
in the hands of any one individual or even any co- 
hesive group of individuals. As a result, the officers 
are not controlled by any dominating owner or group 
of owners, as no one man or small group represents 
a controlling interest in the company, with whom 
the officers can properly confer in order to be guided 
as to its policies. 

This condition places a very heavy responsibility 
upon the boards of directors and principal officers of 
such companies. From a legal standpoint, this re- 
sponsibility is to the stockholders only, but it must 
not be viewed too narrowly if one is to measure it 
correctly. In order to be properly safeguarded, the 
interest of the stockholders, the interest of the cus- 
tomers,—the consuming public,—and the interest of 
the employees must all have the fullest considera- 
tion of those in responsible charge of any industry; 
in fact, the first consideration must be the interest 
of the customer, for unless he is satisfied and at- 
tracted by the treatment he receives, business is lost 
and the company languishes, unemployment for the 
worker being one of the results. 


62 Business and the Church 


The maintenance of proper relations between em- 
ployer and employee, comprising as it does the train- 
ing, handling, and disciplining of all employees irt 
such a manner as to keep them satisfied and to bring 
about the most effective production relationship to 
industry, is a much more intricate problem, and in 
fact the most important and difficult one with which 
those in responsible charge of a company are con- 
fronted to-day. It is too soon to speak with confi- 
dence of the part played by the joint conference com- 
mittee in solving this problem; and like many other 
problems, whether it is a pronounced success or a total 
failure will depend upon the manner in which it is 
handled. Enough evidence is at hand to show that 
a great deal of value, both to the employer and to the 
employee, has come from the establishment of such 
a relationship, codperative in its character and edu- 
cational to both parties at interest. This relationship 
having been established, labor can play a large and 
important part, of tremendous value to itself and to 
the consuming public, of which it forms so large a 
part, if it will adopt a broader attitude than it has 
heretofore assumed, and concern itself not only with 
those things which will further its own narrow in- 
terest, but also and principally with those things 
which are of the most benefit to all connected with 
industry, in the development of which labor should 
be an important and constantly increasing factor. 

The employer must, on his part, be broad in his 
dealings with his employees, and foster a spirit of 


How the Church Can Aid Industry 63 


cordial codperation in matters of mutual interest. 
The church can perform a real service to industry if 
it will help in the advancement of this spirit of co- 
operation. A practical manner in which this can be \/ 
done is for those ministers whose congregations con- 
sist largely of industrial workers to get in personal 
touch with the heads of their local industries and 
learn at first hand the practical problems of the em- 
ployers and their plans for solving these problems. 
These plans will, for the most part, be found to be 
sincere efforts to produce results that will, on the 
one hand, effectively increase the efficiency of pro- 
duction, and, on the other, improve the general wel- 
fare of the worker. The idea that the worker is a 
mere machine is no longer held by an intelligent 
factory manager, and the necessity for recognizing 
the personal needs of the individuals has become an 
industrial axiom. 

The plans of the management of any progressive 
industry to improve the welfare of its employees will 
in all likelihood prove to be more practical than 
those evolved by social workers who have not taken 
the trouble to get first-hand information; and in 
most cases a frank discussion by ministers with em- 
ployees will enable the churchmen to understand 
more clearly the actual conditions in industry and 
to cultivate a spirit of codperation instead of antag- 
onizing employers, who are honestly trying to do 
what they can for the betterment of their employees. 

By doing this, ministers will be on firmer ground 


64 Business and the Church 


and will be able to produce far greater results than 
they will by first placing before the public ideas and 
suggestions which may prove to be impracticable, and 
even injurious, when all conditions are understood. 

Codperative and improved educational effort, to- 
gether with the stimulating effect of a restricted for- 
eign emigration and the use of labor-saving ma- 
chinery, have done much in recent years to improve 
industrial efficiency and at the same time give to 
labor an increasing reward in this field. The Na- 
tional Industrial Conference Board has made an ex- 
haustive and scientific research into this subject, from 
which the following data are of interest: 


Since 1914 the “money” earnings of the industrial wage- 
earners have more than doubled; that is, they obtain more 
than twice as many dollars for a given amount of work. 
Taking into account the higher cost of living, their “real” 
earnings, that is, the purchasing power of their earnings, 
have increased by one third and at the same time their work- 
ing hours have decreased. In 1909 only eight per cent 
worked forty-eight hours a week or less, while ten years 
later these hours were not exceeded by nearly fifty per cent 
of the wage-earners. 

In the last twenty-five years the volume of manufactur- 
ing in the United States has increased threefold, while the 
number of wage-earners has only doubled; the installed 
primary power employed for the improvement of condi- 
tions by labor-saving machinery and better lighting and 
heating has increased by two and one-half times, and the 
use of electrically applied power from less than five per 


How the Church Can Aid Industry 65 


cent to sixty-seven per cent, or an increase of over thirteen 
EUMES. p45): 3¢. | 

To the extent that mechanical power is harnessed to do 
the heavy work in industry and the purely physical things 
that machines can do, formerly done by human labor, to 
that extent men are released from purely physical work for 
the doing of things that require brain-work. While the 
earning power of brawn is limited to so many dollars a day, 
the earning power of brain-work is limited practically only 
by the ability of the individual. Furthermore, inasmuch as 
power application makes possible greater production at 
lower unit cost, the effectiveness of the individual worker, 
and with it, that of the entire industrial enterprise, is in- 
creased, permitting of greater earnings both for the in- 
vestors and the workers in industry. 


I have stressed the importance of codperation be- 
tween employer and employee. In certain direc- 
tions there is no limit to which such codperative ef- 
fort should go; in others, however, there is a limit 
beyond which it is not only unwise to go, but posi- 
tively injurious, alike to employer and employee, 
and consequently to the public which both must serve. 

There is much loose talk among men of high 
standing, but generally with very limited experience 
in industry, about the democratizing of industry and 
giving the men a share in the management of indus- 
trial properties. To the extent of a codperative ef- 
fort between employer and employee to improve 
working conditions, or, in fact, to better any of the 
situations in industry that are unsatisfactory to the 


66 Business and the Church 


employees, such as wages and hours of services, well 
and good; but I maintain that the limit has been 
passed when enthusiastic reformers advocate giving 
a voice in the financial and business management to 
the workman, who has done nothing toward bring- 
ing the industry into existence, and has no respon- 
sibility for the operating results, whether profitable 
or unprofitable. While many managers have come 
from the ranks and there is no limit to the possi- 
bilities of advancement for the workman, a respon- 
sible management is needed for the development and 
even the existence of the industry, a result on which 
depends not only the interest of the many owners 
and the public served, but the employment or non- 
employment of the wage-earners themselves. 

The fallacies of socialism might easily destroy the 
entire structure, the condition of Russian industry 
to-day being an evidence of their effect. Attempts 
to formulate new social creeds, sometimes under- 
taken by reformers and those interested in social 
welfare, are dangerous, since the relations of the 
different elements of which our social structure is 
composed are so intricately interwoven that general- 
izations are almost always wrong in their applica- 
tion and may easily do a great deal of harm. 

We must not fail to recognize that, in all attempts 
at reform, care must be taken that in our efforts to 
bring about changes which, on the surface, appear de- 
sirable, contact is first made with those who are in 
responsible charge of the situations it seems desirable 


How the Church Can Aid Industry 67 


to change, to the end that such changes may be rec- 
ognized as desirable by those who can most naturally 
bring them about. It will seldom be necessary to go 
further, if this first step is well taken and the re- 
forms recommended are really wise and good. 
Enlightened employers will gladly welcome con- 
structive codperation on the part of the church, and 
this help will greatly facilitate the solution of many, , 
of the most pressing problems of industry to-day. 


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WHAT CAN THE CHURCH DO FOR 
LABOR: 


WILLIAM GREEN 
PresIDENT, AMERICAN FEDERATION OF LABOR 


William Green is fifty-three years of age, having been born 
at Coshocton, Ohio, March 3, 1873, the son of Hugh Green, 
an English miner, and Jane (Oram) Green, a native of Wales. 
His family home is at 1602 Chestnut Street, Coshocton, Ohio. 

He gained his education in the public schools of Coshocton, 


_ and when eighteen years old went to work in the mines with his 


father. 

Almost immediately he took an active part in the miners’ 
union. From 1900 to 1906 he was a sub-district president and 
from 1906 to 1910 was Ohio district president of the United 
Mine Workers. 

In 1912 he was elected international secretary-treasurer of 
the United Mine Workers, the office formerly held by William 
B. Wilson, who became the first secretary of labor in President 
Wilson’s cabinet. A year later he was elected vice-president 
and member of the executive council of the American Federa- 
tion of Labor, succeeding the late John Mitchell in that office. 

William Green was a delegate-at-large from Ohio to the 1924 


. Democratic national convention in New York, and was a dele- 


gate-at-large to the Baltimore convention in 1912 which nomi- 
nated Woodrow Wilson, and alternate-at-large to the San Fran- 
cisco Democratic national convention in 1920. 

Mr. Green served two terms in the Ohio State Senate, of 
which he was Democratic floor-leader for both terms and presi- 
dent for both terms. He introduced and secured the enactment 
of the Ohio Workmen’s Compensation Law, which has been 
accepted by organized labor as the model for other States to 
adopt. He also introduced and secured the passage of the Ohio 
Mine Run Law, an act which has proved to be of great benefit 
to the mine workers of Ohio and all those employed in the 
central competitive field (consisting of Ohio, Western Pennsyl- 
vania, Indiana, and Illinois). 


WHAT CAN THE CHURCH DO 
FOR LABOR? 


WILLIAM GREEN 


Men look to the church as the agency which will 
teach them to find the kingdom of heaven and to 
live a righteous life. Labor is generally regarded 
as the hewer of wood and the drawer of water. To 
those who do not see how the various parts of liv- 
ing are interlaced in a complete expression of life, 
the church and labor symbolize different planes of 
activity. Those who find in all of life a unity that 
implies that each different activity is part of a re- 
lated endeavor for self-development seek a unifying 
principle. This I understand to be the basis of this 
inquiry: What can the church do for labor? 


That which is a common tie between all men is! 


sincere longing for life, and life more abundantly. 
Individuals differ widely in the kind of life they 


think they want, but one and all consciously or un- . 


consciously are in quest of the mysteries of the king- 
dom of God, through which we shall learn the mean- 
ing of life. 

Some of us see the church as the road to the king- 
dom of God. Others see it through the redeeming 


power of great social reform. And still others hope » 


71 


72 Business and the Church 


that through the development and release of crea- 
tive power in men human beings may express their 


Spiritual natures. And others there are with the 


penetration to see in all these things the inextinguish- 
able desire of men to have more of life. Men are 
everywhere grasping after pleasures and possessions 
or something to satisfy the longings of human 
nature. This very simple principle brings a definite 
meaning out of what seems otherwise a mad scramble. 

The church has the responsibility of developing 


‘creative activity in spiritual living, and in directing 


religious education along lines that will promote char- 
acter building and right living. In addition we look 
to the church for the art of developing spiritually, 
just as we look to our schools for the art of develop- 
ing intellectually. As the spirit of the man is that 
which dominates and colors his living, it is evident 


, that the church has a functional opportunity to be 
' the all-pervading factor in individual and community 
life, if the church achieves its fullest possibilities. 


Through its influence on the mainsprings of char- 
acter and thus deepening the currents of living, the 
church, that influences spiritual life by maintaining 
high Pedards of justice and fellowship between 
men, makes its greatest contribution to the cause of 
labor. The fundamentals of human relations which 
the church teaches should serve as the basis for hu- 
man relations in industry and all work relations: 

The labor movement had its origin in hunger that 
was both physical and spiritual. Labor seeks life and 


What Can the Church Do for Labor? 73 


life more abundantly.’ It seeks relief from long 
hours and animal-like toil, that it might know the 
glory of well-living and opportunity for the beauty 
and color which add richness, depth, and symbolism 
to living. 

The movement seeks to develop the/character and 
the self-respect of working men and women by mak- 
ing them feel that they are of importance to industry 
and to society and that they should be and must be 
consulted when matters affecting their interests are 
at stake in the concerns for which they are working. 
It brings to workers responsibility instead of accept- 
ance of the position of humbly taking what others 


decide to give them, of dumbly doing what they are 
told. 


Labor movements seek first those economic stand- | 
ards that lift the horizon of the workers’ lives ‘and / 


widen the area in which they live; shorter hours 
and higher wages are fundamental requirements in 


assuring opportunity for development., The move- | 


ment is seeking these things, not for the sake of bet- | 


ter hours and more money, but that it may bring 
more of life to those who do the world’s work. 

By improving the working conditions of workers, 
opportunities are made available for changes in the 
‘personalities of the workers themselves.. The labor 
‘movement seeks first to make conditions of labor 
such that bodies and minds shall not be so poisoned 
or warped that their possessors cannot appreciate and 
use opportunities that may be theirs; it endeavors 


74 Business and the Church 


to make employment more stable, so that families 
need not worry continually over food and lodging for 
to-morrow or live in dread of losing a job, of sick- 
ness, or of other disability. It seeks to provide the 
means for more equitable conditions of employment 
and for the adjustment of difficulties that grow out 
of industrial relations. When definite standards of 
fair dealings are guaranteed jointly by management 
and representatives of the workers, labor is there 
in a position to render longer service and to assume 
definite responsibilities. But labor cannot enter upon 
this larger activity until management creates the op- 
portunity by guarantees of justice that beget confi- 
dence on the part of the workers. 

Our trade-unions are based on craft divisions which 
follow the demarcations of different vocational 
groups. These groups are the repositories of work 
experience, which constitutes technical information 
invaluable in developing greater efficiency and im- 
provements in production. The beginning of this 
type of union management of codperation marks the 
initiation of an educational undertaking of immeasur- 
able significance, for it makes possible the utilization 
of the production experience of all concerned in pro- 
duction. 

The decisions and the policies of the trade-union 
movement must rest with the wage-earners them- 
selves. Upon the various factors in industry rest 
distinct functional responsibilities which labor rec- 
ognizes. Each separate factor must have authority 


What Can the Church Do for Labor? 75 


to decide those matters for which it has functional 
responsibility. But this does not imply arbitrary 
decisions without consideration of all factors and 
elements concerned. In addition to industrial consid- 
erations, public opinion has a real influence in deter- 
mining’ industrial policies. When disputes arise 
within industry, public opinion becomes increasingly 
potential. General discussion of the issues 1s neces- 
sary to an intelligent conclusion, which involves, of 
course, having the necessary data available. In this 


connection the church could render a service, not )7 


only to labor but to industry and society, by provid- 
ing unbiased agencies for joint educational discus- 
sion. This service does not necessitate partizan or 
definitive action on specific issues by the church, for 
that would be distinctly outside its province. But 
the church can with propriety be the champion of 
free discussion and fair play. Of transcendent in- 
fluence would be the ethical standards and emphasis 
on right living which the church would focus upon 
any concrete situation. Understanding of industrial 
conditions and industrial forces is essential to dis- 
cussion. Familiarity with the technique for achieve- 
ment as well as ideals is necessary for clear thinking. 

Any effective aid to labor must be based upon _an 
understanding of workers, their organizations, their 
conditions of work and of living, and the hopes they 
hold. This understanding can be hastened if min- 
isters and the more enlightened of the congrega- 
tions take the lead in furthering it and in increas- 


76 Business and the Church 


ing their own knowledge... They can acquire a more 
intimate knowledge by familiarizing themselves with 
_ factories, by visiting labor-union meetings, by get- 
_ting acquainted with labor publications. Is it not 
profoundly significant for us that for many years 
(Christ lived in the household of a carpenter and 
\was intimately in contact with working people and 
working conditions? To know men, we must know 
them at work. That was one of the reasons He so 
well understood men and what they needed. Life 
and individuals cannot well be understood from books 
alone; first-hand contacts are needed. Ministerial 
associations might arrange for discussion of labor 
problems and invite workers and employers to pre- 
sent their_respective points of view; group visits to 
factories, as well as courses of study, might be 
planned. If ministers and courageous laymen in all 
the churches understood labor’s needs and desires, it 
would be easier for church organizations to make in- 
telligent plans for studies of labor problems in the 
field. 

In another very practical and tangible way, the 
church can help labor by seeing to it that, in_all 


business undertakings which serve its needs, indus-. 


trial relations shall be in accord with highest stand- 
ards. Practically all churches have investments and 
have dealings with business undertakings of some 
measure of importance, and more or less directly the 
church may control industrial-relations policies in 
these undertakings. In this way the church must 


j 


What Can the Ghurch Do for Labor? 77 


lend its support either to the organized labor move- 
ment or to the influence for disorganization. The 
organized labor group is the policy-making and stand- 
ard-establishing agency. The church must support 
this movement or be counted against it. 

As ministers and churches show a more sympa- 
thetic interest in working people, they will be able 
to inspire them to more far-sighted endeavors. And 
laborers need such inspiration. As long as they are 
forced to fight to get what they need, they will tend 
to become self-centered; they may forget that they 
are fighting for better conditions, better hours, bet- 
ter pay, in order that they may get more out of life 
and put more into it. They may become so absorbed 
in the fight itself that its immediate goal may be 
the only thing they see. Churches can aid laborers 
to keep the vision. 

The great preachers of the Old Testament, the 
fathers of our own Christianity, were prophets. They 
translated their great ideals into practical precepts. 
They did not just preach “be good, be good,” or 
“be loving, be kind”; they showed by specific illus- 
trations that men were not practising what they pro- 
fessed. Jeremiah not only denounced idolatry and 
immorality in general; he pointed out the evil he 
saw in concrete political and social projects. Hosea 
dared speak plainly to Ephraim: Nahum dared lead 
his people in a great constructive enterprise. A great 
ministry to-day will dare point out in private and 
in the pulpit the social practices that it sees destroy- 


78 Business and the Church 


ing social and religious sensibilities. A great min- 
istry will seek to understand the nature of the in- 
dustrial system, with its creed of profit, and will 
seek to inspire men to a creed of codperation for 
reciprocal benefit and advancement. A great min- 
istry, an enlightened church, will seek to understand 
working people as well as business men, will seek 
to aid each to work for the welfare of the commu- 
nity, and not for lesser ideals, will do its utmost to 
promote harmony and understanding between groups 
as well as between individuals. 

The great leaders of the labor movement, as well 
as the great men of the church, have had a passion 
for humanity, that men and women might grow to 
the full stature of their capacities and live lives hal- 
lowed by consciousness of the divinity of men and 
toil. By holding men responsible for the achieve- 
ment of those ideals that lift and satisfy the souls 
of men, the church makes its greatest contribution 
to all human progress, including labor. Where there 
is the will for fellowship, ways to adjust industrial 
problems will be found. 


THE WORKER AND THE CHURCH: 
GETTING APART AND GETTING 
TOGETHER 


WHITING WILLIAMS 
CounsEL IN INDUSTRIAL AND PuBLic RELATIONS 


Whiting Williams puts into his article more than the ordinary 
amount of experience with his fellow-men. Everybody knows 
about his years of work in overalls as a laborer among laborers 
in this country and abroad. He left his position as vice-president 
and director of personnel of a large Cleveland steel company, 
donned overalls, and became a journeyman laborer in the mines 
and factories of this and other countries, just to find out the 
things that were uppermost in the mind and the life of the 
worker. He wanted to know what unrest, the war of capital 
and labor, class hatred, strikes, unions, internationalism, bolshe- 
vism, and kindred by-products of the war and of the times— 
just what these things mean to the laboring man. 

He believed that there was but one sure way to find out; and 
that was to become a laboring man, do his work, live his life, eat 
his food, endure his hunger and fatigue, associate with his friends 
—and help fight his enemies. 

He has labored in the coal-mines, steel-plants, and ship-yards 
of Great Britain. He spent summers as a common laborer in 
Germany, France, and Belgium. Wide interest has been at- 
tracted by his articles and books, especially his What's on the 
Worker’s Mind, and, more recently, his more philosophical dis- 
cussion of the problem of influence and human relations in 
Mainsprings of Men. ‘To-day he gives himself to writing and 
to lecturing before different groups, including the young men 
at the Graduate Schools of Business at Harvard and Dartmouth; 
in addition he acts as counselor in industrial relations for certain 
large employers of about 250,000 workers. 

Mr. Williams graduated from Oberlin College in 1899, 


THE WORKER AND THE CHURCH: GET- 
TING APART AND GETTING TOGETHER 


Wuitine WILLIAMS 


“Amen—und Gliick auf!” (“Amen—and good 
luck!”)) That was the way we coal-miners in Ger- 
many’s Saar Valley would all lift our heads and, 
turning to each other, complete the prayer in which 
the mine foreman led us each morning after as- 
‘signing us to our various working-places below 
ground. With that we would pick up our safety- 
lamps and take our positions in the line, awaiting our 
turn to go into the cage or hoist and down to our 
daily jobs in the dark passageway inside. 

The spirit of those morning devotions represents 
the attitude of the average worker toward the church 
immensely better than do the much heralded expres- 
sion of antipathy and bitterness. That is my belief 
after my recent years of studying the labor problem 
by the overalls method; by doing the laborer’s work 
and, so far as possible, living his life, in the basic 
industries of coal, steel, and transportation both here 
at home and in the five most industrialized nations 
abroad. 

Many workers hate the church, just as they do 
the state and various other institutions. But these 

81 


82 Business and the Church 


men are the result of a variety of maladjustments, 
the greatest of which is the irregularity of their 
work. For the most part they are at the bottom 
of the House of American Industry, casual and itin- 
erant workers who have no family, no home, no fixed 
community, very slight—if any—skill, and, worst 
of all, a minimum hold upon any job anywhere. 
These maladjustments must be corrected if ever these 
men’s souls are to be saved. But meanwhile the bit- 
terness of their attitude to the church should not be 
accepted as representing the feelings of that larger 
body of workers who have families, homes, a certain 
amount of skill and “know-how,” and a fairly secure 
hold upon a certain job in their permanent com- 
munity. 
/ Of this larger group of wage-earners the attitude 
/ toward the church—the Protestant church—is not so 
much of antipathy as is generally believed. It is an 
attitude not of antipathy, but of indifference. This 
indifference is shared by many of the worker’s white- 
collared friends. It is largely the result of a general 
misunderstanding. For that misunderstanding the 
minister is partly to blame; but so are most of us, 
his church members. It arises largely from the fail- 
ure of the minister and his church-members to un- 
derstand the worker’s inmost hankerings and then 
to meet him and to minister to him in the midst of 
them. 

I can’t tell about these unless I borrow a phrase 
I encountered everywhere among the workers and 


The Worker and the Church 83 


ask you to “Lemme tell you my experience!” In 
order to study the worker’s mind, I arrived one day 
about six years ago in a big steel center with twenty- 
five dollars in my pocket. I had agreed with my 
friends at the office and at home that if this sum 
was spent before I got a common laborer’s job, it 
would be up to me to live for at least six months the 
life of the jobless man, whatever that might bring. 
Under an assumed name, with an unshaved face, and 
in the worst of clothes, I began my search for work 
—and with it my education in the worker’s wants. 
That very day I began to learn what every one must 
learn if he would understand the mind and heart of 
the worker; namely, the colossal importance to that 
worker of the daily job—the compelling necessity 
of getting a job to-day, and then, by some means or 
other, of gripping it for a job to-morrow. 

There in that necessity is where the whole mod- 
ern problem of industrial relations, and so of social 
relations, gets its start—there, and not in the wage 
disputes which so generally fill the head-lines. It 
is simply impossible to overstate the extent to which 
the worker considers, and must consider, the job as 
the very axis upon which his daily life revolves. 

“For the last eight months I ’ve been workin’ prac- 
tically every day,” a thoughtful carpenter confided. 
“But I swear to God there was n’t hardly an hour of 
it but my heart jumped every time the boss started 
my way, a-fearin’ that he was comin’ to lay me off. 
And not once, I tell you, did I ever get home ten 


84 Business and the Church 


en a NLT TOE 


minutes before my regular time but my wife she seen 
me comin’ down the street and ran out to the gate 
to meet me, askin’ me always with a catch in her 
throat: ‘Has it come? Tom, tell me quick! Has it 


| come?? ” 


It is such experience in the lives of literally mil- 
lions which gives rise to most of the troublesome 
shortcomings of the worker as we white-collared folk 
observe him. Such experience of the insecurity of 
his work tempts him to loaf and string out the job, 
to lay three hundred bricks instead of a possible thou- 
sand or more. The same uncertainty of his future 
makes him not too friendly to the new machinery 
which takes the place of men, even though the new 
invention may later increase the output of those who 
remain on the job, lower the price of their product, 
and thus in the long run create a demand for more 
workers than before. The trouble is that the hurry- 
up pressure of next Saturday night’s bills does not 
allow the head of a family much time to look at 
things in the long run. 

Right here is laid a large part of the first tier of 
misunderstanding between the worker and the church. 
We white-collared members grow resentful of the 
worker’s apparent neglect of his proper duty to pro- 
duce his daily utmost, and he in turn grows equally 
resentful of our inability to understand any of those 
difficulties in his experience which he believes justify 
for him a certain amount of loafing and self-pro- 
tection. 


The Worker and the Church 85 


But this first tier contributes only the beginnings, 
the foundations, of the misunderstanding between 
the worker and the church. What goes upon these 
foundations is a misunderstanding of a more spir- 
itual and therefore more serious sort. This misun- 
derstanding results from our inability to “get” the 
real reasons why the worker’s job is so important, 
so vital, to him. 

“All this worker fellow wants is in the pay-enve- 
lop!” is the way this inability is generally expressed. 
Almost universally we assume that of course the job 
is important to the worker simply because it repre- 
sents the indispensable wherewithal to buy the daily 
bread and butter and shoes and stockings. Almost 
universally we assume that the weekly pay repre- 
sents the whole of the worker’s thought about his 
work. 

It took me three weeks to get the first inkling that 
this explanation is inadequate—extremely inadequate 
and terribly harmful, because it leaves out a certain 
spiritual factor. For three weeks I had shoveled hot 
and dusty brickbats out of the steel plant’s fallen- 
in furnaces. I was one of a motley crew of Mexi- 
cans, Indians, negroes, and various foreign-born un- 
skilled laborers, working fourteen hours during the 
night week, ten hours during the day-turn, and eigh- 
teen or twenty-four hours every other Sunday. 

“Charley, how ’d you like to join the millwright 
gang?” the foreman called to me one night. He ap- 
peared to think he was offering me a distinguished 


86 Business and the Church 


honor, in spite of his explanation that it paid only 
two cents an hour more. I accepted it with indif- 
ference. Surely so slight an increase in pay could 
not mean much of a promotion. Almost my first 
move proved me wrong. As I came by my former 
companions, carrying my new tools of oil-can and 
wrench, I made a veritable sensation. Every one 
of my old friends leaned on his shovel and wiped 
the sweat and dirt out of his eyes while he exclaimed: 
“Hey, Boodie! Were you catch-em job? Meel- 
wright gang? Oil-can and wr-rench! No more 
shovel!” From that moment I found it possible 
to talk familiarly with the first and second helpers, 
those experts who study through their colored spec- 
tacles the changing condition of the furnace’s bath 
of hot metal up to the instant of the tapping. For 
three weeks I had puzzled why they would have 
nothing to do with me as a laborer. Now we were 
suddenly become pals! If my wife had lived near- 
by she would doubtless have received the calls and 
congratulations of the wives of the unskilled la- 
borers: “Your man he catch-em fine job!” And not 
one of them but would have observed closely the 
next day to see whether she continued to speak to 
them! All this amazing change of status inside the 
plant and out with a difference of only two cents an 
hour! 
Numberless other instances could be cited of this 

| outstanding fact: everywhere among the workers a 
| man determines the social standing of himself and 


The Worker and the Church 87 


his family not so much by the earning power as by 
the nature of his job. 

So it goes unceasingly up and down the line. Even 
the hobo is insulted if we fail to see the difference 
of function which puts him far above the tramp. 
“We ‘boes,’” so the secretary of a hoboes’ union 
exclaimed to me almost with tears in his eyes, “we 
have to get from, say, the Northwest timber camp 
in the winter to the Oklahoma wheat-fields in the 
summer. If we don’t get there on time, crops go 
to waste and millions o’ dollars are lost. So we 
hoboes have to take the train—without payin’ fare, 
of course! But atramp! Why, he walks from job 
to job, ’cause he don’t care whether he gets there or 
not—and nobody else does!” Even below the tramp 
comes still another grade, the “bum.” “Hes a no- 
good complete; he neither rides nor walks nor 
works!” 

To-day the huge factory and its thousands of jobs, 
all divided up into little pieces, makes it more dif- 
ficult than in the old days for the modern worker to 
enjoy the satisfactions of the craftsman as much as 
he would like. But the possibilities for the same 
pride in his handiwork are still infinitely greater 
than we outside observers are apt to think. We have 
all been entirely too quick to assume that the worker’s 
life can be made worthy only through a worthy lei- 
sure; too quick to look at a man’s dirty hands and 
conclude that his heart is altogether barren of any 
satisfaction in them. 


88 Business and the Church 


This, our failure to see anything but the dollar in 
the worker’s feeling for his work, has reared the wall 
of a genuine spiritual misunderstanding between the 
wage-earner and the rest of us, in our churches and 
out of them. This wall is highest between the worker 
and the minister simply because the modern minis- 
ter’s job makes it harder for him than for the rest 
of us—and that’s saying a lot!—to understand the 
modern worker’s wish, and the modern worker’s 
ability, to find something genuinely spiritual in his 
daily job. More than the rest of us the present- 
day leader of the church tends to assume that of 
course the worker’s hours of toil are completely void 
of spiritual satisfaction and that accordingly he should 
seek such satisfactions in the church on Sunday if he 
is to find them anywhere in his life at all. 

This mistaken assumption accounts, I believe, more 
than does any other one factor for the worker’s 
failure, such as it is, to be interested in the church. 
At the same time, this assumption arises from causes 
for which the minister is not altogether to blame. 

“T was all packed up for attending our national 
denominational convention,” a pastor in a small coal 
town once told me. ‘Then the word came that one 
of my best friends had been killed in a near-by mine 
explosion. I immediately wrote the sermon and un- 
packed to await the setting of the date of the funeral. 
That was two years ago! Only last week the res- 
cuers, after two years of constant work, finally suc- 
ceeded in reaching the bodies of my friend and his 


The Worker and the Church 89 


companions. This morning I got back from deliver- 
mg my sermon!” 

That is typical of the difficulties which the church 
faces when it plans to reach and serve the worker 
where he really lives and moves— in his work. 

“ “I see,’ said the blind man”; that was all the wis- 
dom I could muster that first morning when, after 
fourteen hours of hard labor with a shovel in a steel 
plant, I stumbled up the hill past the town’s churches, 
libraries, and schools. For the first time I began 
to understand why in Cleveland we had had so much 
trouble interesting the city’s laborers in the social 
work of our philanthropies. I could see plainly 
enough that morning those walls which to-day a 
man’s job builds up around him; walls which proceed 
pretty much to determine his entire life from day 
to day. 

Practically everywhere in industrialized America 
we citizens are free to enter the school, the library, 
or the church only in those hours which are left to 
us after we have first earned our living. Further- 
more we take with us into these places only that 
equipment of muscle, mind, or spirit which is left to 
us after we have first met the compulsions of the daily 
task. 

“No, never go back home again in Norway,” a 
sailor once confided to me; “no, not even with fine 
suit of clothes! With my mother—yes, with her I 
could talk. But with my sisters—no, never! You 
see, in all twelf year away from home, never once do 


90 Business and the Church 


I have one word with good, decent woman. Some- 
thing gone—” (with hand on heart) “something 
gone in here!” 

We all know—and every sailor knows—perfectly 
well that no one can talk about a sailor’s soul apart 
from a sailor’s life. But every sailor knows a thou- 
sand times better than the rest of us that it is idle 
to speak of a sailor’s life except when you view it as 
largely the result of a sailor’s job. 

“Of course, a fellow drinks up there in them rot- 
ten lumber camps,” a hobo once explained. “Be- 
cause the drunker ye be the less ye ’re a-mindin’ 0’ 
the flies and the bugs! And when ye sober up, ye ’re 
used to ’em!” 

In the steel plant old Uncle Zeke knew he was 
slipping. Every month the boss was giving him an 
easier and easier job; and that meant he was becom- 
ing less of a man because less of a craftsman. But 
in the saloon he was anxious to tell me of his success- 
ful career, of one good job after another. When I 
asked him how drunk he liked to get, he gave me the 
key to the connection between men’s wishing and 
their living. 

“Oh, I just like to get drunk enough,” he ex- 
plained, “well, just drunk enough to get the feelin’ 
of me old position back again, like.” 

Everywhere the world’s workers understand bet- 
ter than do the rest of us the inescapable influence 
which our work wields upon our entire lives. That 
is precisely why they seek in their work those spir- 


The Worker and the Church 91 


itual satisfactions which we outsiders so continuously 
fail to observe. It is because they seek those spir- 
itual satisfactions that they find a measure of them 
which too many ministers find it simply impossible to 
understand. 

“And all that day—” a leader tells of the engi- 
neers and mechanics who were installing the amplify- 
ing device by which President Harding’s eulogy of 
the Unknown Soldier was heard by multitudes in 
Washington, New York, and San Francisco, after 
all had said the Lord’s Prayer together in a trans- 
continental unison of hearts and voices— “and all 
that day not one of us workers but, rather than have 
the occasion fail, would gladly have dropped dead in 
his tracks!” 

Now when such men, or any one of millions like 
them, go to church, they run too often the risk of 
being almost insulted in precisely the way I was. It 
was in one of New York’s greatest churches that I 


heard a certain noted preacher pray in a manner | — 
which, I must confess, made it hard to keep from | | 
throwing a hymn-book at him! He explained, and | | 
apologized, to the Lord that all of us, his hearers, | 
had to earn a living. That seemed to prove to him | | 
that by Saturday night we were not only tired, but | 
disgusted, soiled, completely degraded. It was too | 
bad, he realized and duly explained to the Lord, but | 
it simply could n’t be helped. The trouble evi-| | 
dently was that Father Adam back there in the gar- _ 
den had played us all a low-down trick and put the | 


92 Business and the Church 


curse of labor eternally upon us. But all this being 
true, and evidently beyond all fixing, he certainly 
was grateful, he told the Lord, that after a nasty, 
worthless, demoralizing week like that, all of us 
could come into his ecclesiastical laundry and religious 


| barber-shop every Sunday morning. There, thanks 


| be, he was delighted that he could give us all a good 


spiritual cleansing and so put enough self-respect 
and moral pep into us to make us tackle another week 
of unavoidable, but totally distasteful and insignifi- 
cant, toil! | 

The maker of such a prayer has missed completely 
all that longing which really grips the worker. He 
assumes that if the doers of work do not come to 
church, then their lives must be totally devoid of any 
spiritual gratification whatever. That assumption 
makes it practically impossible for him to minister 
to them; he simply does not know where to find 
them. 

As a matter of fact, too many pastors make ex- 
actly the same mistake, not only with the laborer, but 
also with the business man—even the business man 
and the employer in their congregations whom they 
call by their first names! 

Once I made an engagement with a certain min- 
ister. I wanted to talk over with him my new line 
of work, and to reassure myself, perhaps, that it was 
thoroughly worth doing. We had not talked long 
about superficial things before he asked me, “But 
now tell me about what you are doing; are you mak- 


The Worker and the Church 93 


ing a fair living at it?” I assured him that it pro- 
vided a fair income, and was just beginning to lay 
before him the real question of its worthiness, its 
value to others, when he nodded his head and made 
it perfectly plain that he saw no further query in 
the matter! I ended the conference as quickly as 
possible and proceeded to obtain the desired advice 
from the most thoughtful of my business associates. 

It is not strange that the modern minister has made 
this mistake of assuming that men are interested in / 
work simply for the money it brings them. He is/ 
just like the rest of us; we all discern the worthiness 
of our own work, but we can’t imagine how the other 
fellow can see the worthiness of his! The compul- 
sions of our own jobs tend to build up partitions 
around us which cut us off from appreciating both 
the compulsions which press similarly upon the lives 
of our neighbors and the spiritual satisfactions we 
contrive to find within the limits of these compul- 
sions. 

But more than for most of us the minister’s job 
has itself lately suffered an unfortunate change. His 
church has lately become a large organization with 
a multitude of business and other details demanding 
his attention. More and more he has to divide his 
week between the duties of an ecclesiastical busi- 
ness manager and those of religious lecturer. His 
lectures, also, require constantly more attention, just 
as rapidly as the school, the library, the newspaper, 
the movie, and the radio increase the knowledge and 


94 Business and the Church 


the intelligence of his hearers. So the weekly 
preacher and the daily business manager tends con- 
stantly to give less and less time to the hourly pastor. 
That in turn lessens his opportunity to get close 
enough to his hearers to know where they really live 
and move. He comes to be a poor salesman of his 
wares simply because he has no time to study his cus- 
tomer. His job requires so much energy for broad- 
casting to his people from the pulpit that he has lit- 
tle time to listen in to the longings of their hearts 
and the breathing of their prayers. 

One of the most significant developments of our 
times has been the shifting thus of a large part of 
the old pastoral function away from the preacher’s 
study to the newspaper office. 

“Weep on Gwendolyn’s shoulder!” is the invita- 
tion which heads the column of one Mid-Western 
daily. It is only one of thousands of such columns 
in which are laid bare the plaints and longings, the 
calls for assistance, of every type of anxious hu- 
manity. In other parts of the same papers also will 
be found advertisements of still others who earn 
their daily bread—and also their daily belief in 
their own worthiness—by doing a part of the pastor’s 
job. They offer to prepare men or women for in- 
creased responsibility in business by this or that tech- 
nical training, adding, “We give expert and intimate 
study of your personal difficulties with counsel for 
their overcoming.” Such advertisers are merely 
utilizing the youth’s willingness to correct his weak- 


The Worker and the Church 95 


nesses if only such corrections can be made to count 
toward the living of a worthier life through the 
doing of a better job. 

No man can be a good preacher who is so busy 
with his business or his books that he cannot take the 
time to listen to the troubles of his hearers. 

But the minister is less to blame for this change 
in his own job and its unfortunate results than are 
we, his members. In the long run he has to take 
his orders from us, just as does the worker in the 
factory from his employer. We have put new and 
big responsibilities upon him without arranging prop- 
erly for his continuing his older duties. Like the 
worker, therefore, and all the rest of us, he has to 
adapt himself and make the most of the limitations 
as well as the liberties of his job. When we changed 
his work we changed his contacts with his fellow hu- 
mans. That, in turn, changed his ideas about these 
humans and lessened his understanding of the han- 
kerings at the bottom of their hearts. For that, fi- 
nally, we, his employers, pay the price—we miss the 
fellowship and the encouragement he might other- 
wise extend us where we wish it extended,—namely, 
in our work. 

So we church-members, together with our 
preachers and our fellow workingmen, will all 
profit and all get closer together as soon as we ap- 
preciate the necessity of taking men’s jobs into ac- 
count as part and parcel of their spiritual as well as 
their mental and physical lives. In the experience 


96 Business and the Church 


of every one of us this great truth prevails: we all 
tend to Jive our way into our thinking and feeling 
enormously more than we think our way into our 
living. 

So the modern minister simply must give thought 
to the work of modern men if he is to exercise any 
influence over their lives or their souls. There can 
be no water-tight compartment between the well- 
being of a man’s spirit and the work of his hands. 
Every worker has abundant need of all the help that 
the minister can give to improving the conditions of 
his task. Such things as the twelve-hour day are spir- 
itual as well as social and physical stumbling-blocks. 
But such help does not require the minister to at- 
tack the capitalist and the manager as though they 
were necessarily wilful malefactors driven solely by 
greed. When the minister’s job permits him to get 
closer to men in their work he will find that rich 
men, poor men, beggar men—yes, and thieves—are 
all surprisingly alike; that it is easy to find differences 
‘between them in the matter of much education and 
little, large earning-power and small, huge respon- 
sibility and tiny, but very difficult to assign virtue to 
any one group of them and vice to the other. Some 
of the truest and best men I know are employers of 
scores of thousands of wage-earners,; others are 
among their humblest employees. Of them all, with- 
out regard to their jobs, I find the biggest hankering 
is the longing for greater certainty of themselves and 


The Worker and the Church 97 


their individual worth to other people. All of them, 
whether grouped as “capital” or “labor,” seem to 
share with all the rest of us that prayer which morn- 
ing and evening was in the heart of Job: 


Oh that I knew where I might find him! that I might 
come even to his seat. I would order my cause before him, 
and fill my mouth with arguments. I would know the 
words which he would answer me, and understand what 
he would say unto me. Will he plead against me with 
his great power? No; but he would put strength in me! 


Not one of us but knows that his longed-for 
strength and certainty of the Establisher of All 
Values cannot be enjoyed unless somehow we can 
find where it means most to us—within ourselves. 

What every worker knows is that in all the cracks 
and crannies of our body, mind, and soul, no spot 
in all the universe is half so fitting for His taber- 
nacle as that part of us which, if anywhere at all, 
makes us indispensable to others, namely, our jobs! 

That being my finding among the workers every- 
where in all levels of modern society without respect 
to wealth or poverty, I don’t see how the minister, 
or any one else who wants to help, can join with one 
of these groups to fight against the other. But I 
do see and know that both of these groups need and 
long for the help of all of us—and especially of 
our ministers and churches—before they can believe 
what I find them striving with all their hearts daily 


98 Business and the Church 


to believe; namely, that it may be truly said of each 
of them to-day as it was said of old times of their 
forefathers, the artificers and workmasters: 


All these put their trust in their hands, 

And each becometh wise in his own work; 

Yea, though they be not sought for in the council of the 
people, 

Nor be exalted in the assembly; 

Though they sit not on the seat of the judge, 

Nor understand the covenant of judgment; 

Though they declare not instruction and judgment, 

And be not found among them that utter dark sayings; 

Yet without these shall not a city be inhabited, 

Nor shall men sojourn or walk up and down therein. 

For these maintain the fabric of the world, 

And in the handiwork of their craft is their prayer. 


REPRESENTATION IN INDUSTRY 


JOHN D. ROCKEFELLER, JR. 
An InstRUMENT IN PROMOTING THE WELFARE OF MankIND 


John D. Rockefeller, Jr., has devoted his life to carrying for- 
ward his father’s benevolent plans. Graduated from Brown 
University in 1897, soon became his father’s chief assistant and 
counselor in philanthropy; so that much of his time has been 
spent in studying the various projects calculated to realize his 
father’s hope, expressed in the charter of the Rockefeller Founda- 
tion: “to promote the welfare of mankind in all parts of the 
world.” 

Mr. Rockefeller, Jr., up to June, 1926, has given nearly 
$50,000,000 to public benevolence, extending or supplement- 
ing work already supported by his father. Upon the Bureau 
of Social Hygiene he has bestowed $2,000,000, to carry on re- 
search work for the purpose of improving public health in certain 
fields. He contributed $1,500,000 toward the Inter-Church 
World Movement and $500,000 toward completing the Cathe- 
dral of St. John the Divine in New York City. At an expendi- 
ture of $2,360,000 he built, furnished, and is carrying on the 
work of International House, on Riverside Drive, in which hun- 
dreds of Columbia University students from all parts of the 
world live and work together in amity as one great family. 

Mr. Rockefeller has also given $3,500,000 to the New York 
Public Library, $2,500,000 to the Hampton Tuskegee Insti- 
tute for Negroes, $1,000,000 toward the restoration of the 
cathedral of Rheims and the gardens of Versailles, and 
4,000,000 yen ($1,540,000) toward restoring the Imperial Uni- 
versity of Tokyo, Japan. He gave, in 1923, $21,000,000 to 
found and maintain the International Education Board, which 
will advance research and education, especially in promoting 
agricultural science and practice throughout the world. 

He has invested several millions of dollars in the construction 
of community housing, whereby small wage-earners can live in 
clean, hygienic apartments, and raise their families in decent, 
pleasant homes that will help the children to grow up strong, 
good citizens. 


REPRESENTATION IN INDUSTRY 


Joun D. RockeEFE.uer, Jr. 


In the days when kings and queens reigned over 
their subjects, the gratification of the desires of those 
in high places was regarded as of supreme moment; 
but in these days the selfish pursuit of personal ends 
at the expense of the group can and will no longer 
be tolerated. 

Men are rapidly coming to see that human life is 
of infinitely greater value than material wealth; that 
the health, happiness, and well-being of the indivi- 
dual, however humble, is not to be sacrificed to the 
selfish aggrandizement of the more fortunate or 
more powerful. 

Modern thought is placing less emphasis on 
material considerations. It is recognizing that the 
basis of national progress, whether industrial or so- 
cial, is the health, efficiency, and spiritual develop- 
ment of the people. 

Never was there a more profound belief in human 
life than to-day. Whether men work with brain or 
brawn, they are human beings, and are much alike 
in their cravings, their aspirations, their hatreds, and 
their capacity for suffering and for enjoyment. 

The soundest industrial policy is that which has 

Io! 


102 Business and the Church 


constantly in mind the welfare of employees as well 
as the making of profits, and which, when human 
considerations demand it, subordinates profits to wel- 
fare. Industrial relations are essentially human re- 
lations. 

It is therefore the duty of every one intrusted with 
industrial leadership to do all in his power to im- 
prove the conditions under which men work and 
live. 

The day has passed when the conceptions of in- 
dustry as chiefly a revenue-producing process can be 
maintained. To cling to such a conception is only 
to arouse antagonisms and to court trouble. 

In the light of the present, every thoughtful man 
must concede that the purpose of industry is quite as 
much the advancement of social well-being as the 
accumulation of wealth. It remains none the less 
true, however, that to be successful, industry must 
not only serve the community and the workers ade- 
quately, but must also realize a just return on capital 
invested. 

The parties to industry are four in number; they 
are capital, management, labor, and the community. 

Capital is represented by the stockholders and is 
usually regarded as embracing management. 

Management is, however, an entirely separate and 
distinct party to industry: its function is essentially 
administrative; it comprises the executive officers, 
who bring to industry technical skill and managerial 
experience. 


Representation in Industry 103 


Labor consists of the employees. 

Labor, like capital, is an investor in industry; but 
labor’s contributions, unlike that of capital, is not 
detachable from the one who makes it, since it is 
in the nature of physical effort and is a part of the 
worker’s strength and life. 

Here the list usually ends. The fourth party, 
namely, the community, whose interest is vital, 
and in the last analysis controlling, is too often 
ignored. 

The community’s right to representation in the 
control of industry and in the shaping of industrial 
policies is similar to that of the other parties. Were 
it not for the community’s contribution, in maintain- 
ing law and order, in providing agencies of trans- 
portation and communication, in furnishing systems 
of money and credit and in rendering other services, 
—all involving continuous outlays,—the operations 
of capital, management, and labor would be enor- 
mously hampered, if not rendered well nigh im- 
possible. 

The community, furthermore, is the consumer of 
the product of industry, and the money which it 
pays for the product reimburses capital for its ad- 
vances and ultimately provides the wages, salaries, 
and profits that are distributed among the other 
parties. 

It is frequently maintained that the parties to in- 
dustry must necessarily be hostile and antagonistic. 
I am convinced that the opposite is true; that they 


104 Business and the Church 


are not enemies but partners; and that they have a 
common interest. 

Moreover, success cannot be brought about through 
the assumption by any one party of a position of 
dominance and arbitrary control; rather it is de- 
pendent upon the codperation of all four. Partner- 
ship, not enmity, is the watchword. 

If codperation between the parties to industry is 
sound business and good social economics, why 1s 
antagonism sometimes found in its stead? The an- 
swer is revealed in a survey of the development of 
industry. 

In the early days of industry, the functions of 
capital and management were not infrequently com- 
bined in the one individual, who was the employer. 
He in turn was in constant touch with his employees. 
Together they formed a vital part of the community. 
Personal relations were frequent, and mutual con- 
fidence existed. When differences arose they were 
quickly adjusted. 

As industry developed, aggregations of capital 
were required larger than a single individual could 
provide. In answer to this demand, the corporation, 
with its many stockholders, was evolved. Countless 
workers took the place of the handful of employees 
of earlier days. Plants scattered all over the coun- 
try superseded the single plant in a given community. 

Obviously this development rendered impossible 
the personal relations which had existed in industry, 
and lessened the spirit of common interest and under- 


Representation in Industry 105 


standing. Thus the door was opened to suspicion 
and distrust, enmity crept in, antagonisms developed. 
The parties to industry came to view each other as 
enemies instead of as friends and partners, and to 
think of their interests as antagonistic rather than 
common. 

The sense of isolation and detachment from the 
accomplishments of industry, which too often comes 
to the workers of to-day, can be overcome only by 
contact with the other contributing parties. Where 
such contact is not possible directly, it must be brought 
about indirectly through representation. In this way 
only can common purpose be kept alive, individual 
interests safeguarded, and the general welfare pro- 
moted. 

The question which now confronts the student of 
industrial problems is how to reéstablish personal re- 
lations and codperation in spite of changed con- 
ditions. The answer is not doubtful or questionable, 
but absolutely clear and unmistakable: it is through 
adequate representation of the four parties in the 
councils of industry. 

Various methods of representation in industry 
have been developed, conspicuous among them 
are those of labor-unions and employers? associa- 
tions. 

Labor-unions have secured for labor in general 
many advantages in hours, wages, and standards of 
working conditions. A large proportion of the 
workers of the country, however, are outside of these 


106 Business and the Church 


organizations and, unless somehow represented, are 
not in a position to bargain collectively. Therefore 
representation of labor to be adequate must be more 
comprehensive and all-inclusive than anything thus 
far attained through its unions. 

Representation on the employers’ side has been 
developed through the establishment of trade asso- 
ciations, the purpose of which is to discuss matters 
of common interest and to act, in so far as is legally 
permissible and to the common advantage, along 
lines that are generally similar. But here also repre- 
sentation is inadequate. Many employers do not be- 
long to employers’ associations. 

A plan of representation which a number of Amer- 
ican industries have adopted aims to overcome these 
difficulties. The plan begins with the election of 
representatives in a single plant, and is capable of 
indefinite development to meet the complex needs 
of any industry and of wide extension so as to include 
all industries. Equally applicable in industries where 
union or non-union labor or both are employed, it 
seeks to provide full and fair representation to labor, 
capital, and management, taking cognizance of the 
community. 

Thus far it has developed a spirit of codperation 
and good will which commends it to both employer 
and employee. 

The outstanding features of this plan of industrial 
representation are as follows: 

Representatives chosen by the employees, in pro- 


Representation in Industry 107 


portion to their number, from their fellow-workers 
in each plant form the basis of the plan. 

Joint committees, composed of equal numbers of 
employees or their representatives and of officers of 
the company, are found in each plant or district. 

These committees deal with all matters pertain- 
ing to employment and working and living con- 
ditions, including questions of codperation and con- 
ciliation, safety and accident, sanitation, health and 
housing, recreation and education. 

Joint conferences of representatives of employees 
and officers of the company are held in the various 
districts several times each year. 

There is also an annual joint conference, at which 
reports from all districts are received and considered. 

Another important feature of the plan is an officer 
known as the president’s industrial representative, 
whose duty it is to visit the plants currently and con- 
fer with the employees’ representatives, as well as to 
be available always for conference at the request of 
the representatives. 

Thus the employees, through their representatives 
chosen from among themselves, are in constant touch 
and conference with the management and repre- 
sentatives of the stockholders in regard to matters 
pertaining to their common interest. 

A further feature of the plan is what may be 
termed the employees’ bill of rights. This covers 
such matters as the right to caution and suspension 
before discharge, except for such serious offenses as 


108 Business and the Church 


are posted; the right to hold meetings at appropriate 
places outside of working hours; the right without 
discrimination to membership or non-membership in 
any society, fraternity, or union; and the right of 
appeal. 

The employee’s right of appeal is a third out- 
standing feature of the plan. Any employee with 
a grievance, real or imaginary, may go with it at 
once to his representatives. 

The representatives not infrequently find there 1s 
no ground for the grievance and are able so to con- 
vince the employee. 

But if a grievance does exist, or dissatisfaction on 
the part of the employee continues, the matter 1s 
carried to the local boss, foreman, or superintendent, 
with whom in the majority of cases it is amicably 
and satisfactorily settled. 

Further appeal is open to the aggrieved employee, 
either in person or through his representatives, to the 
higher officers and to the president. 

If satisfaction is not to be had from the company, 
the court of last appeal may be the Industrial Com- 
mission of the State, the State Labor Board, or a com- 
mittee of arbitration. 

The plan has proved an effective means of enlist- 
ing the interest of all parties to industry, or repro- 
ducing the contacts of earlier days between employer 
and employee, of banishing misunderstandings, dis- 
trust, and enmity, and of securing codperation and 
the spirit of brotherhood. 


Representation in Industry 109 


Under its operation, the participants in industry 
are being convinced of the soundness of the proposi- 
tion that they are fundamentally friends and not 
enemies, that their interests are common, not op- 
posed.. Moreover, prosperity, good will, and hap- 
piness are resulting. Based as the plan is upon prin- 
ciples of justice to all, its success can be counted on 
so long as it is carried out in a spirit of sincerity 
and fair play. 

Here, then, would seem to be a method of pro- 
viding representation which is just, which is effective, 
which is applicable to all employees whether organ- 
ized or unorganized, to all employers whether in 
associations or not, which does not compete or in- 
terfere with existing organizations or associations, 
and which, while developed in a single industrial 
corporation as a unit, may be expanded to include all 
corporations in the same industry and ultimately all 
industries. 

If this theory of the human relations between 
employer and employee is sound, might not the four 
parties to industry subscribe to an industrial creed 
somewhat as follows? 

(1) I believe that labor and capital are partners, 
not enemies; that their interests are common, 
not opposed; and that neither can attain the 
fullest measure of prosperity at the expense 
of the other, but only in association with the 
other. 

(2) I believe that the community is an essential 


110 


(3) 


(4) 


(5) 


(6) 


Business and the Church 


party to industry and that it should have 
adequate representation with the other 
parties. 

I believe that the purpose of industry 1s 
quite as much to advance social well-being 
as material prosperity; that, in the pursuit 
of that purpose, the interests of the com- 
munity should be carefully considered, the 
well-being of employees fully guarded, 
management adequately recognized, and 
capital justly compensated, and that failure 
in any of these particulars means loss to all 
four parties. 

I believe that every man is entitled to an 
opportunity to earn a living, to fair wages, 
to reasonable hours of work and proper 
working conditions, to a decent home, to the 
opportunity to play, to learn, to worship, 
and to love, as well as to toil, and that the 
responsibility rests as heavily upon industry 
as upon government or society to see that 
these conditions and opportunities prevail. 

I believe that diligence, initiative, and effici- 
ency, wherever found, should be encouraged 
and adequately rewarded, and that indolence, 
indifference, and restriction of production 
should be discountenanced. 

I believe that the provision of adequate 
means of uncovering grievances, and 


(7) 


(8) 


(9) 


Representation in Industry 111 


promptly adjusting them, is of fundamental 
importance to the successful conduct of in- 
dustry. 

I believe that the most potent measure in 
bringing about industrial harmony and pros- 
perity is adequate representation of the 
parties in interest; that existing forms of 
representation should be carefully studied 
and availed of in so far as they may be found 
to have merit and are adaptable to conditions 
peculiar to the various industries. 

I believe that the most effective structure of 
representation is that which is built from the 
bottom up, which includes all employees, 
which starts with the election of representa- 
tives and the formation of joint committees 
in each industrial plant, proceeds to the for- 
mation of joint district councils and annual 
joint conferences in a single industrial cor- 
poration, and admits of extension to all 
corporations in the same industry, as well as 
to all industries in a community, in a nation, 
and in the various nations. 

I believe that the application of right prin- 
ciples never fails to effect right relations; 
that “the letter killeth but the spirit giveth 
life”; that forms are wholly secondary, 
while attitude and spirit are all-important; 
and that only as the parties in industry are 


Alp 


(10) 


Business and the Church 


animated by the spirit of fair play, justice 
to all, and brotherhood will any plan which 
they may mutually work out succeed. 

I believe that that man renders the greatest 
social services who so codperates in the or- 
ganization of industry as to afford to the 
largest number of men the greatest oppor- 
tunity for self-development and the enjoy- 
ment of those benefits which their united 
efforts add to the wealth of civilization. 


THE PSYCHOLOGY OF EMPLOYERS 


SAMUEL A. LEWISOHN 
PresipENT AMERICAN MaNnaGEMENT ASSOCIATION 


Mr. Lewisohn’s activities have taken him into many fields— 
mining, banking, civic and educational work, and writing on 
economic and industrial subjects. 

He was educated in Columbia Grammar School, Princeton 
University, and Columbia Law School. 

Mr. Lewisohn is a member of the firm of Adolph Lewisohn 
and Sons, director of the Bank of America, and vice-president 
and director in several large mining companies. 

He is greatly interested in better housing and is on the board 
of the City and Suburban Homes Co.; he is director of the 
Morris Plan Co. of New York, and chairman of the board of 
the American Management Association. He was a member of 
the Economic Advisory Committee of the President’s Confer- 
ence on Unemployment called in September, 1921. 

Mr. Lewisohn’s name is on almost every board of industrial 
relations, and the material in his article is based on as broad an 
experience in dealing with his fellow-citizens as it is possible 
for one man to have. 


THE PSYCHOLOGY OF EMPLOYERS! 


Sam A. Lewisoun 


There has been much discussion of the mental hy- 
giene of industry,—the discussion invariably dealing 
with the problem of the mental hygiene of em- 
ployees,—but nothing has been said about the mental 
hygiene of employers. 

I am reminded of an episode which occurred at a 
meeting of a society for mental hygiene. One of the 
speakers, a judge of the children’s court, stressed the 
necessity of mental hygiene among children. Where- 
upon the presiding officer, a physician, suggested that 
the judge had omitted an important aspect of the 
matter and that was the necessity of studying the 
mental hygiene of many of the judges. 

As the employer is the most influential person in 
industry, it is well for all interested in the future 
organization of our industrial structure to remember 
that the executive temperament is seriously to be 
taken into consideration in the development of a 
better administration of industrial activities. If the 
formula of reorganization is incompatible with execu- 


* The author takes this opportunity to express his thanks to E. P. 
Dutton & Company, publishers of his forthcoming book, The New 
Leadership in Industry, for permission to excerpt some of the 
material of that book for the present chapter. 


115 


116 Business and the Church 


tive traits, production will be seriously impeded. A 
great deal of the industrial thought of the future 
should, therefore, be devoted to the psychology of 
employers and of leadership. For securing adequate 
leadership is vital under any system. In the existing 
situation, these leaders are the employers and those 
who are on the road to becoming employers. 

If the principal factor in industrial harmony 1s 
the leadership of the employer, we come to the ques- 
tion: Who are these employers? The average per- 
son is likely to reply at once, “The capitalists.” 

The different groups concerned in the operation of 
a large enterprise are, first, the banking group, repre- 
senting the capital interested, and second, the major 
executives of the company, who report to the direct- 
ors representing this financial interest. An important 
group is the local production executives, usually 
called resident managers, who report to the major 
executives in charge of the production department. 
Under the resident managers, there are plant super- 
intendents and shop foremen. 

Production executives are indispensable under any 
system and will always be with us. The leaders 
upon whose ability and enthusiasm successful opera- 
tion depends are the production executivés. Any 
improvement hoped for in the administration of 
industrial activities must take into account all these 
individuals. 

The question of leadership frequently raised is: 
Who gives the cues that motivate our executives? 


The Psychology of Employers 117 


One group of persons, not familiar with the way 
business is actually conducted, have a romantic theory 
that the reactions of industrial executives are in re- 
sponse to those who give them their bread and butter 
—the capitalists. There is an idea current in some 
quarters that action toward labor is controlled by 
such a definite capitalistic attitude that when an ex- 
ecutive acts he does so as a sort of economic auto- 
maton instead of as an individual. 

There is unquestionably a great deal of exageera- 
tion in this idea. The people who entertain this 
theory have a vision that Wall Street makes decisions 
on all questions. The corollary is that if Wall Street 
should suddenly change its views, the executives of 
the plants in the country would at once change theirs. 
The notion makes it appear that the obstacle to better 
labor relations is solely that of a small oligarchy. 
If that were true, our problem would be much 
simpler. It would involve solely changing the char- 
acter of the control of industry, and not changing the 
traditions, attitudes, and personalities of production 
executives. 

That the idea that the banking group controls labor 
policies is a great over-simplification may be illus- 
trated by the following example. There is an im- 
portant banking house that is interested in the Balti- 
more and Ohio Railroad. It is also interested in 
the Union Pacific Railroad. Both are important 
railroad systems. It would seem that the influence 
of this banking house should be similar in both rail- 


118 Business and the Church 


roads. But the railroads have radically different 
labor policies. The B. & O. Railroad has introduced 
a significant experiment in working out codperation 
in the shops between union committees and managers, 
while the Union Pacific has refused to treat with the 
unions, instituting an elaborate plan of employee 
representation in its place. Bankers are more in- 
terested in results than in theories. 

As far as production and employment policies are 
concerned, modern financiers, in most cases, leave 
the matter entirely in the hands of the major ex- 
ecutives in whom they have confidence. There are, 
of course, exceptions, in which the bankers have 
displayed a direct interest, sometimes in a reactionary 
way, sometimes in a liberal one. 

In turn, the major executives are likely to leave 
wide discretion to the local production manager, not 
only as to technical matters, but also as to the partic- 
ular methods to be adopted in relation to the per- 
sonnel, including the rank and file of the working- 
men. Though there are exceptions, this sort of 
decentralization is the tendency of the times. It is 
from the resident manager that the entire atmosphere 
and spirit that exist at a plant spring. He sounds 
the note for the others to follow. If he is reactionary, 
a liberal labor policy is impossible. Even if he has 
the will but lacks courage, initiative, or social in- 
genuity, a policy of experimenting with newer labor 
methods will not be carried through. 

The surest evidence, however, that the psychologi- 


The Psychology of Employers 119 


cal attitude of the managers is important is this: if 
the group in financial control or the major executives 
are more enlightened than the local executives, they 
are likely to have a real uphill job in winning over 
the lesser officials to their way of thinking. An in- 
teresting example of this kind is the difficulty Mr. 
Arthur Nash had in converting his executives to the 
conclusion that his workers should join the Amalga- 
mated Clothing Workers. A report on the matter 
states that some of the executive staff and the fore- 
men resented the fact that the head of the firm had 
reached a decision opposed to their own. 


For two days and nights they went about among the 
workers, haranguing against the union, challenging Mr. 
Nash’s wisdom. It was not until noon of December 10, at 
a great mass-meeting of all the thousands of employees 
gathered in the Shubert Theater, in Cincinnati, that Mr. 
Nash was able by the most impassioned personal appeal to 
win a majority, including the leaders of the opposition-— 
among them two vice-presidents—to support his request that 
the working out of a plan be left to him and President 
Sidney Hillman of the Amalgamated. . . . Those three 
days, December 8, 9, 10, were tense with excitement. The 
workers were confused, many of them struck dumb, by the 
open division between the foremen and manufacturing 
executives and Mr. Nash.? 


The cases in which a reactionary labor policy is 
forced upon production managers are not by any 


*Robert W. Bruere, “Golden Rule Nash,” in the Nation, Jan- 
uary 6, 1926, p. 10. 


120 Business and the Church 


means so frequent under our modern structure as is 
generally supposed. The neglect of financiers to 
promote certain desirable policies by fiat is due to a 
reluctance to interfere that is based on the sound ad- 
ministrative principle of the delegation of respon- 
sibility. It is also due to the fact that they are 
specialists in financial matters and do not feel com- 
petent to handle personnel problems. 

Sometimes resident managers are influenced by the 
attitude of other managers of the same rank in the 
same district, and there may even be an attempt by 
such a group to force a conservative policy upon 
more liberally minded managers. This attitude can- 
not be ascribed to capitalistic consciousness, but is 
inspired by the type of administrative positions occu- 
pied by the individuals. The same reaction may be 
observed among officials in a non-capitalistic activity. 
It may be due to a difference in interests between the 
executive and the working groups, because each 
happens to have a different status in the organiza- 
tion. The executives resent the challenge to their 
authority. It applies just as much to such non- 
capitalists as school superintendents or government 
officials as it does to the capitalists. 

The attitude of the executives may be explained 
in large measure by the natural autocracy of leader- 
ship. This trait is not to be attributed to capitalism. 

There is the germ of autocracy in every leader, 
from the college president to a labor-union leader. 


The Psychology of Employers 121 


The theory that consultation of one’s subordinates 
is best for all concerned is a modern conception, and 
is a by-product of our modern democratic belief that 
it is best for getting results and for the self-develop- 
ment of those to be led. At present the wise leader 
who understands the advantages of consulting sub- 
ordinates is exceptional. 

Of course, the ordinary impatience of executives 
with interference is complicated in the industrial field 
by certain manifestations that might be considered as 
a product of capitalism. But much of their reluctance 
to share authority is easy to explain on other grounds, 
One of the advantages of capitalism to an executive 
is that under its unified, but decentralized, control he 
can count on the man at the top to back him up in 
time of stress, or to reward him for good results. 
The alternative which the executive fears is to have 
to deal with a group of people with divergent in- 
terests, with whom he will have to play politics in 
order to maintain his position. 

In the psychology of the industrial executive, 
therefore, one must take account of this aversion to 
anything that has a semblance of politics. It ex- 
plains also the resistance to unionism which is so 
strong among executives. There is usually more 
prejudice against unionism among resident managers 
and local superintendents and foremen than there 
is in the home office among the upper executives and 
directors, who constitute the capitalists. The lower 


122 Business and the Church 


executives bitterly resent this interference with their 
right to be boss of their domain, which they feel is 
one of the perquisites of their position. 

We must change executive temperament by de- 
veloping different behavior patterns. We have, to 
this point, stressed the contention that the attitude of 
industrial leaders can be explained in part by certain 
innate psychological characteristics, by a natural ar- 
rogance of leadership arising under any system. In 
addition, there is an acquired attitude that is due toa 
traditional environment and to obsessions resulting 
from the industrial relationships of the present sys- 
tem. For it is the conjunction of the two elements, 
a natural autocracy and an acquired attitude, that 
explains why the leaders of to-day act as they do. 

Though employers come from dissimilar environ- 
ments and in many respects are affected by dissimilar 
influences, in one respect they seem to have the same 
emotional backgrounds. When an issue comes up 
concerning the labor problem, they do not think; 
they feel. They may approach other problems in an 
objective, even a scientific, spirit, but on labor ques- 
tions they quickly strike an attitude. How differently 
executives will react to difficulties interposed by phys- 
ical causes and to difficulties interposed by human 
situations! ® In the former case they usually display 


® Graham Wallas, in discussing the subject of liberty, stresses the 
point that what we mean by liberty is not freedom from inter- 
ference with physical causes but freedom from human interference. 
“Common usage refuses to say that the liberty of a Syrian peasant 
is equally violated if half of his crops are destroyed by a hail of 
locusts, half his income is taken by a Turkish tax-gatherer, or half 


The Psychology of Employers 123 


poise and patience. In the latter they too often give 
way toa futile exasperation. They are, in most cases, 
class-conscious. 

What influences have made the employer class- 
conscious? The following theory may be true. 

History shows that every social and economic sys- 
tem has been subjected to criticism. The capitalist 
régime, in an era of political freedom, has probably 
been subject to a more universal and more continuous 
attack than any other system. Employers have been 
made to feel that they are the oppressors. Because 
under this system the leadership is thus constantly 
under the charge of exploiting its subordinates, inner 
feelings of uneasiness or guilt, which modern psy-~ 
chologists assert we all possess within our uncon- 
scious areas, have been stirred up. 

Thus the relations of employers with labor are 
tinged with an unpleasant emotional state, which 
makes the whole subject disagreeable to them. And 
as with many distasteful subjects, there is a tendency 
to neglect labor relations. This tendency may be 
compared to the flight from reality that we find in a 
person who does not want to face a disturbing situa- 
tion. 

The employer reacts in one of several ways. The 
whole matter may be left to subordinates to handle, 


his working hours are taken for road construction by a German or 
French commander; because human obstruction of our impulses 
produces in us under certain conditions reactions which are not 
produced by obstruction due to non-human events.” (Our Social 
Heritage, Yale University Press, 1921, p. 160.) 


124 Business and the Church 


who use archaic methods handed down from genera- 
tion to generation. The class-conscious spirit in other 
cases takes on an aggressive form, a hard-boiled, die- 
hard spirit. Picking off agitators, fighting all at- 
tempts at unionization, and other direct methods 
result, and success is measured by the extent to which 
these measures keep the labor force submissive. The 
effect of class-consciousness on still other employers 
is that they adopt an attitude of benevolent pater- 
nalism. To borrow a term from modern psychology, 
in a sort of evangelical spirit, they over-compensate 
for their own class-consciousness by a desire to do 
good to their people. It was in this mood that a 
good deal of the welfare movement was conducted. 
Some call it playing Santa Claus to the worker. 

Experienced business men know that in business 
relations a certain amount of imagination is necessary. 
The ability to see the other man’s point of view is 
what distinguishes the broad negotiator, the big busi- 
ness man, from the small, petty, hard trader. A 
negotiator who brings this quality to his activities 
is not called sentimental. We rather admire this 
quality and point to it as a badge of success. But 
when it comes to human relations with the rank and 
file of labor, such a breadth of view is often char- 
acterized as soft and sentimental. This view is held 
not merely by executives of narow imagination, but 
by others who should know better. 

Why should interest in human relations be re- 
garded as a sort of weakness in an executive? Why 


The Psychology of Employers 125 


should problems of industrial politics not be regarded 
as of the same business importance as other subjects? 
A clever trader, financier, or salesman is apt to be 
invested with a greater prestige than a man who is 
clever at organizing people. In the business world, 
the man who can discuss large questions of economics, 
finance, or investments is regarded with marked re- 
spect. The man who has made a study of employ- 
ment psychology or other labor questions and can 
discuss such problems ably is regarded at best as no 
more than an interesting figure. 

In the civic world, we hear a good deal about our 
best citizens neglecting politics. It is true in this 
country that governmental politics does not suffi- 
ciently interest the intellectually and socially influen- 
tial groups. But it is perhaps even more true that 
industrial politics, that is, the best methods of or- 
ganizing people in a plant, has been neglected by 
strong business groups. 

Now, executives and business men desire to be 
active in those affairs which will give them prestige in 
the eyes of the community. Like boys at college,— 
and it must be remembered that active business men 
are often, emotionally, grown-up boys,—executives 
like to be prominent in affairs which are generally re- 
garded by their equals as important. Men in active 
life, as differentiated from philosophers, are disposed 
to make life a series of games. In fact, in colloquial 
speech, we hear of men playing the financial game, 
the publishing game, the law game. Is there any 


126 Business and the Church 


hope that they will in time learn to play the human- 
organization game? 

The problem is largely that of securing a new 
emotional orientation toward the subject on the part 
of our employers and our executives. Instead of 
boasting of the size of their plants, the quantity of 
their output, and the amount of their profits, they 
must be induced to boast of the excellence of their 
methods of human organization. Their sporting 
instincts must be diverted in this direction. We must 
secure competition in good organization. In fact, 
this is beginning to come about. 

Once the problem of organizing human beings has 
been invested with the prestige that will arise from 
the awakened interest of major executives, it will 
seep down through all grades of executives. It is 
a problem which must be understood by the entire 
hierarchy of executives. The proper treatment of 
this subject at professional schools, such as engineer- 
ing and business colleges, will prove an important 
element in arousing more interest than has been mani- 
fested in this subject. 

In the last fifty years we have heard repeated 
over and over again the cry, “If only labor leaders 
were better educated!” By the proper education of 
the workman and of his leaders, much, it has been 
hoped, would be accomplished. Education, cultural 
and economic, of the adult workers is excellent and 
deserves the widest support. It is, however, a slow 
process, and this movement alone cannot furnish the 


The Psychology of Employers 127 


means of substantially improving industrial relations 
in the near future. In bringing about team-work in 
our industries and the proper adjustment of the in- 
dividual to his job, it is the employer (and by this 
I mean the managing executive), not the trade- 
unionist, that is the important factor. The education 
of the employers in employer-employee relations 
would, therefore, seem to be of at least equal con- 
cern with workers? education. The matter must be 
attacked through the engineering schools and pro- 
fessional institutions from which executives are re- 
cruited, through government research agencies which 
aid the employer, and through widening the scope 
and influence of the associations of business execu- 
tives? 

In conclusion, it may well be emphasized that the 
improvement of industrial relations requires that the 
problem be seen whole. An attitude by which only 
the workers are taken into account is better than an 
utter indifference to the subject. But it is defective 
and impractical because it does not take into account 
an equally important factor, the psychology of the 
executive and the need for developing and adapting 
him to a better social order. 


RESEARCH IN INDUSTRY 


A. H. YOUNG 
InpustRIAL RELATIONS CouNsEL 


At present Mr. Young directs the activities of the firm of 
Industrial Relations Counselors, Inc. The organization engages 
in research along industrial lines, makes surveys of industries 
and plants and acts as counselors on matters of personnel admin- 
istration to a number of important industrial corporations. 

Mr. Young’s first contact with industry was as a boy at the 
Joliet Works of the Illinois Steel Company. From there, he 
went to the Minnequa Plant of The Colorado Fuel and Iron 
Company, and after several years’ experience was transferred, 
in 1905, to the Chicago works of the Illinois Steel Company, 
where he began as time-keeper. He was afterward chief pay-roll 
clerk, statistician, assistant supervisor of labor, chief safety in- 
spector and supervisor of labor and safety. In the last position 
he had charge of all phases of personnel administration. 

Mr. Young left the South Chicago works of the Illinois 
Steel Company to become director of the American Museum of 
Safety in 1917, and while serving in that capacity was lent to 
the Government by the trustees of the museum as chief safety 
expert during the war. He had charge of accident-prevention 
work in all the arsenals, navy-yards, and other industrial estab- 
lishments of the Federal Government. 

From July 1, 1918, to July 1, 1924, Mr. Young was manager 
of industrial relations at the International Harvester Company, 
and as such directed the varied and comprehensive industrial- 
relations program developed by the company. He was a co- 
author of the Harvester Industrial Council Plan and respon- 
sible for the administration of this significant development in 
employee representation. He was president of the National 
Safety Council from 1921 to 1922 and is vice-president of the 
American Museum of Safety. In 1919 the museum awarded 
him the Louis Livingstone Seaman medal for conspicuous ac- 
complishment in safety. 

In July, 1924, Mr. Young became Industrial Relations 
Counsel for the law firm of Curtis, Fosdick and Belknap. ‘The 
Industrial Relations Staff of the firm was reorganized as the 
Industrial Relations Counselors, Inc. in May of this year (1926). 


RESEARCH IN INDUSTRY 
A. H. Youne 


There is no phase of industrial activity which does 
not lend itself to improvement through scientific 
research, proceeding as it does by the collection and 
classification of facts and the development of theories 
from these facts. Such procedure furnishes a sound 
basis for action which cannot be attained in any other 
way. 

In general, research may be divided into two 
groups: pure or fundamental research, and adaptive 
or applied research. Industry is particularly con- 
cerned with the latter type, in which the results of 
pure research are tested by further experiment for 
adaptation of the newly discovered fact to existing 
production methods. 

In this article, a line is also drawn between that 
research which deals with the mechanical or physical 
side of the industry and that which deals with human 
relations in industry. Before reviewing the field 
of research in the physical aspects, it is needful to 
point out the diversity of groups of people and sub- 
jects involved. 

Thus we have in America a growing appreciation 
of a unified scheme of life, involving economic, 

131 


132 Business and the Church 


political, social, intellectual, and spiritual factors. 
More specifically, industries on the one hand are 
concerning themselves increasingly with the well- 
being of their customers and with the whole envircn- 
ment in which their employees live, while, on the 
other hand, the church is broadening its activities to 
include affairs of the working hours of its active and 
potential members, in addition to affairs of private 
and public life with which the church has long been 
concerned by common consent. In this relationship 
with the church and with other social institutions, in- 
dustry is not only taking a position of codperation, 
but is striving to clean its own house of industrial and 
social ills. 

In the present, as in the past, social and industrial 
progress is being affected basically by the develop- 
ment of communication. Along with the radio, the 
airplanes, and the older means of communication and 
travel, there may be included, among the agencies for 
communication, the national and international con- 
ferences, organizations, and movements which have 
caused peoples to intermingle as they never did be- 
fore. The tremendous. problems growing out of 
these larger and more numerous contacts appear to 
be forcing upon the world a recognition of relation- 
ships which heretofore have not been generally ac- 
cepted. 

The electrical industry is one of the most notable 
examples of a business created and maintained by 
continuous research. Several companies in this in- 


Research in Industry 133 


dustry maintain outstanding research organizations. 
Research in the field of pure science is encouraged 
and even required. Investigation conducted without 
immediate results in view has often served as a basis 
for changes of epochal significance. The story of 
the application of science to the technical processes 
of industry would make a Thousand and One Nights’ 
Entertainment of exciting reality. Whole industries 
have been created by scientific discovery. Others 
have been revolutionized; still others are making 
continuous improvements as a result of their re- 
search activities. 

Langmuir’s work on the vacuum-tube, based upon 
the electron theory of electricity, is an example of 
this. The uses of the vacuum-tube are many, the best 
known being in connection with radio operation. The 
Coolidge X-ray tube is a vacuum-tube which promises 
to revolutionize the technical practices of chemists 
and engineers and perhaps the manufacturing 
methods of steel-makers, as well as those of other 
producers of metals. 

The work of the electrical laboratories, which most 
immediately concerns the majority of people, results 
in cheaper and better lighting. The Mazda light, 
was the result of experimentation with tungsten. It 
is estimated that the discarding of the carbon lamp 
has reduced in price the light bill of America by 
two thirds. A unit of light to-day costs five per 
cent of what it cost in 1880. Aside from the money 
saving, no estimate can be made of the increase in 


134 Business and the Church 


production and the decrease in accident rates through 
improved factory lighting. 

It is now possible to send the human voice from 
continent to continent, to send messages around the 
world, all in an incredibly short time. Rapid and 
direct communication, which is doing more to change 
civilization than any other one thing, is another 
American research contribution. The story of the 
beginnings of the telegraph and the telephone is too 
well known to need repeating. At present, the Bell 
System through its various subsidiaries is carrying 
on continual investigation in all fields of communica- 
tion. More than thirty-five hundred scientists and 
technicians are occupied in keeping ahead of the 
world in the art of communication. The instruments, 
the lines, and the materials are all subjected to study 
and are constantly being improved. 

Two of the outstanding developments which have 
done much to extend telephone communication are 
the lead cable and the vacuum-tube repeater. The 
old method of stringing wires separately overhead 
materially limited the number which it was possible 
to use. The present cables, which can carry fifteen 
hundred pairs of wires, are less than three inches in 
diameter. The use of these cables in the Bell Sys- 
tem has alone resulted in the saving of one hundred 
million dollars. 

Transcontinental telephone service was announced 
in 1915 as a result of one of the few inventions 
“made to order.” In 1912 the Bell Telephone 


Research in Industry 135 


Laboratories were told that transcontinental service 
was to be made possible by January, 1915. No 
larger wires could be strung. The ordinary trans- 
mitters and receivers had to be used. The solution 
lay in some sort of device, to be inserted at inter- 
vals along the line, which would amplify the sound 
of the voice sufficiently to carry it the entire distance. 
Three different methods were tried. The vacuum- 
tube was the one which solved the problem. 

Although there are, perhaps, no other industrial 
research laboratories the products of which affect so 
large a proportion of the population, there are many 
which are pointing the way to cheaper processes, the 
utilization of materials hitherto wasted, and the 
synthetic manufacture of much needed chemicals, 
too rare or too expensive to use in their natural state. 
Over five hundred private companies have their own 
laboratories and spend approximately twenty-five 
million dollars in their investigations. It is signifi- 
cant that firms such as E. I. duPont de Nemours & 
Co.., Swift & Co., Eastman Kodak Company, West- 
inghouse Electric and Manufacturing Company, and 
General Motors Company, all among the most suc- 
cessful in their fields, have been active in the support 
of scientific research. 

Industrial research is by no means limited to pri- 
vate companies. There are many firms so small that 
it is not feasible for them to equip and maintain 
efficient laboratories even though they may need the 
products of research. Codperative research through 


136 Business and the Church 


the agency of trade associations has solved their diffi- 
culty in many instances. A recent report issued by 
the United States Chamber of Commerce contained 
an incomplete list of thirty-nine associations which 
are carrying on various research projects in their own 
laboratories. 

Altogether, it is estimated that there are about siX 
hundred and fifty applied-science laboratories in the 
United States, with a working personnel of more than 
thirty thousand and an annual expenditure of ap- 
proximately two hundred million dollars. 

Technical research, by whatever agency it may be 
conducted, is directed toward improving commercial 
products by changes in their constituent elements or 
in the machines used for making them. Within the 
past fifteen years, the scientific method has come to 
be employed in the solution of many other industrial 
problems. 

Careful investigation of manufacturing methods 
has, in many instances, disclosed the need for re- 
arranging departments, planning work, rerouting 
materials, and keeping records of every kind of 
procedure. An almost infinite number of instances 
can be cited in which research along one or more of 
these lines has resulted in higher productivity, re- 
duction of waste, lowered costs, and increased wages. 

An industrial concern has only partially finished 
its problem when it has learned how to produce 
something scientifically. There is next the question 
of selling it. Here again research procedure has 


Research in Industry 137 


revolutionized methods. Commercial research in- 
cludes an analysis of sales results and sales methods, 
market analysis, analysis of advertising results, study 
of general business conditions and business cycles, 
determination of sales quota, seeking new uses for a 
product, general economic problems. 

The search for new uses for a given article has 
proved itself of great value in increasing sales and 
stabilizing employment. The opening up of foreign 
markets has served the same purposes. 

The business cycle is coming out of its lecture- 
room, text-book environment to play an active part 
in the sales and production policy of many companies. 
Certain firms have found that a statistical correlation 
exists between their own business curve and that of 
certain other businesses. In this way, use can be 
made of business forecasts and indices. One company 
estimated its sales for the following year within one 
half of one per cent by this method. 

Enough has been said of research into industrial 
operations, outside of the field of personnel, to in- 
dicate the attention which is being paid to it. The 
most recent research development, however, is 
directed to a more effective and a more considerate 
use of the human factors of industry. This is gener- 
ally known as personnel or industrial relations re- 
search. Personalities, like chemicals, explode if not 
properly associated. Although the knowledge of 
people’s actions is perhaps a century behind that of 
physical laws, there is already available a vast body 


138 Business and the Church 


of information in the field of human relations. 
Scientists in the field of anthropology, psychology, 
psychiatry, and sociology are studying human nature 
and contributing to the knowledge of it as never be- 
fore. Industrialists and others dealing directly with 
labor and personnel problems are eagerly taking ad- 
vantage of every new thought which has been dem- 
onstrated to have practical value. 

The search for truth and for facts has resulted in 
an intensive study by industry of possibilities and 
methods for improvement of efficiency, for the 
creation of wholesome, sanitary, and healthful con- 
ditions of work, and for the selection and adjust- 
ment of employees to particular jobs under har- 
monious relations. 

Considering the attention paid to development of 
mechanical labor-saving devices and to machinery, 
it is tragic that so little has been done with the most 
complicated and valuable unit of all, the human ele- 
ment. Manufacturers who have taken care that their 
machines were properly maintained have quite un- 
consciously permitted deterioration of the human 
operator through bad light, poor air, long hours, and 
other inefficient working conditions. 

Happily the failures of the past in these respects 
are now being corrected through scientific research 
which delves into the physiological and psychological 
make-up of the employee. 

From the beginning of the industrial revolution, 
the failure of industry to synchronize the physical 


Research in Industry 139 


and human factors has resulted in countless struggles 
between employees and employers. Early in the 
nineteenth century, the humanitarian movement 
emphasized the wrong of treating employees as 
machines. Robert Owen and a small group of high- 
minded manufacturers in England formed the So- 
ciety for National Regeneration, in 1833. The most 
definite proposal of this group was that the work- 
day be shortened to eight hours. The trade-union 
movement in its long history added other demands 
covering conditions of employment, wages, health, 
and safety. 

It was not until the twentieth century, however, 
that any considerable number of employers came to 
appreciate the fact that it might be economically ad- 
vantageous as well as just to devise ways of running 
their establishments which would keep their em- 
ployees contented and in good health. The more 
thoughtful and logical industrialists realized that in 
order to accomplish the desired results they must in- 
vestigate conditions before instituting changes and 
check up the results after changes had been made. 

Good intentions have proved insufficient. Per- 
sonnel factors may be isolated just as are production 
factors, and if the problems arising out of human re- 
lations are to be solved, they must be approached in 
the same scientific manner as are the problems of 
physical science. This attitude is the basis for per- 
sonnel research. 

Personnel research is variously defined. Dr. Elton 


140 Business and the Church 


Mayo states that its object “is to see to it that our 
understanding of the human problems of civiliza- 
tion is at least equal to our understanding of its 
material problems.” Dr. L. L. Thurstone says that 
it is “the study of scientific methods of man in re- 
lation to the trades, arts, and professions. It is con- 
cerned with the human as contrasted with the 
mechanical factors in agriculture, industry, com- 
merce, government, education, and other occupa- 
tional spheres.” 

The two sciences which have thrown most light 
on how to better personnel conditions are, of course, 
physiology and psychology. There are branches 
known as industrial medicine and industrial psy- 
chology which apply the knowledge of their field to 
industry. Physiology is called on to determine the 
physical requirements for various jobs, to observe 
the effects of hours and working conditions on the 
health of workers. Psychology, dealing as it does 
with the laws of the mind and human behavior, can 
be applied even more generally. Mental tests help 
in employment; fatigue studies show the effect of 
methods of work and conditions of work; psychiatry 
helps in understanding the “temperaments” of 
workers; and the study of adult human behavior 
suggests most successful incentive methods. 

The first direct contact which the employee makes 
with any industry is when he comes to apply for 
work. The old-fashioned method of employment 
amounted to little more than getting together a 


Research in Industry 141 


number of applicants for jobs and choosing among 
them, largely on the basis of looks, then putting them 
into any jobs which were available. If strength were 
necessary, there would be some adjustment on that 
basis. Any other requirement was ignored. The 
foreman was allowed to decide whether a man “made 
good” and was usually free to dismiss him on any 
grounds which, in the foreman’s judgment, were 
good and sufficient. The criteria on which all de- 
cisions were made were, scientifically speaking, un- 
reliable, since they were nothing more than opinion. 

A developing knowledge of human beings has 
made clear the fact that individuals are fundament- 
ally different in ways which education can but slightly 
affect. It is also obvious that jobs are of many kinds, 
requiring a variety of different qualities in the people 
who carry them on. Only careful investigation of 
each job and each person applying makes it possible 
to find the person for a given task. Experience has 
shown that it can be accomplished within limits, pro- 
vided the preliminary research is carefully done. 

The exact description of a job in terms of its con- 
ditions and requirements is called a job specification 
and can only be made by painstaking observation and 
by consultation with men on the job. The process 
of job analysis may be carried on by the employ- 
ment department of a given firm, by a research or 
planning department, or by specialists who are called 
in for the purpose. These specialists may be manage-~ 
ment engineers, industrial-relations counselors, or 


142 Business and the Church 


psychologists. The chief difference in job specifi- 
cations, apart from the amount of detail which is 
included, lies in the description of mental qualifica- 
tions. The psychologists express these qualities 
largely in terms of response to certain mental tests, 
while the others suggest the general qualities needed, 
such as accuracy, patience, application, neatness, etc., 
and depend on the observation of the members of 
the employment department to determine whether 
or not an applicant fulfils the mental requirements. 

An outstanding example of job analysis is that 
done by the International Harvester Company. Each 
of the several hundred jobs in the various plants has 
been subjected to minute study by department heads, 
foremen, and members of the personnel department. 
Printed job specification cards set forth the job name, 
the duties, and the necessary and desirable qualifi- 
cations New employees are assigned to work and 
transfers and promotions are made on the basis of 
these specifications. 

The work of psychologists in finding mental tests 
which can be used to choose the applicants who will 
succeed at given jobs is one of the most interesting of 
all the applications of science to industry, although 
it is still in the experimental stage and has its dis- 
tinct limitations. So-called moral qualities cannot 
be determined, and tests can only be worked out 
for jobs at which a number of people are employed 
under similar conditions, at work which can be 
measured as to performance. A job analysis having 


Research in Industry 143 


been made, the psychologist knows what the neces- 
sary qualifications for a specified job are; tests are 
then chosen which it is hoped will differentiate the 
good from the poor worker; these tests are given to 
workers whose performance on the job is known. If 
success in the tests has a high correlation with success 
on the job, the tests are ready to use on applicants. 
The new worker’s records are watched to check 
finally the value of the tests. 

This procedure has been found of great value in 
firms of many different kinds and has been applied to 
a great variety of occupations. Dr. Henry C. Link 
has applied mental tests to inspectors, assemblers, 
machine operators, office clerks, stenographers, com- 
puting-machine operators, time-study men, drafts- 
men, tool-makers, and tool-makers? apprentices in a 
plant manufacturing shells and firearms. 

The Milwaukee Electric Railroad and Light Com- 
pany retained a consulting psychologist from 1920 
through 1922, and from 1922 to the present time it 
has employed a staff psychologist to continue the de- 
velopment of tests for motormen. Although tests 
have been worked out which seem to differentiate 
between good and poor motormen, there has been 
some difficulty in checking them, because the accident 
record is the only criterion with which to correlate 
success and failure in the tests. The records of new 
men, employed on the basis of the tests, are being 
kept and will serve as a check. 

Several large department stores have psychologists 


144 Business and the Church 


as members of their regular staffs, and tests are 
being worked out and applied for various kinds of 
work. 

Native aptitude, as determined by psychological 
tests or observation, is by no means the only necessary 
requirement for success at a given job. The physical 
demands, as indicated by the job analyses, must also 
be taken into account, and here medical science 1s 
called upon in order to determine what the necessary 
requirements are and to indicate what physical fail- 
ings the applicant must not have. Bad lungs, a bad 
heart, and flat feet, all are dangerous in certain occu- 
pations and quite harmless in others; it is the medical 
examiner’s duty to study the jobs and allocate 
workers accordingly. 

Very few firms apply the research method to the 
wage system, even where they recognize its value in 
other respects. The going rate, with adjustments to 
suit particular conditions, is usually considered the 
standard, and generally raises are given when neces- 
sary. A notable exception to this is the newly worked- 
out method of the Philadelphia Rapid Transit Com- 
pany. A committee chosen under this plan, after in- 
vestigating wage-payment methods for more than 
a year, decided that the cost of living should be the 
determining factor in wage changes. The normal 
rates for all jobs are set by committees and vary with 
length of service and degree of responsibility. 
Monthly data on the cost of specified articles are to 
be obtained, and adjustments are to be made yearly 


Research in Industry 145 


on the basis of changes. Provision for more frequent 
change is made if the purchasing power of the dollar 
varies ten points or more from the original index 
over a period of three months. This system is in the 
nature of an experiment, since it has only been in 
operation a short time. 

Another type of wage payment which attempts to 
reward effort on a scientific basis is that which varies 
with the employee’s output. Wage increases on the 
basis of the cost of living are predicated on the theory 
that employees have a right to a certain standard of 
living; increases on the basis of output are predi- 
cated on the theory that if employees increase their 
product without an increased overhead they are add- 
ing to the profits of the firm and have a right to a 
share in what they make. 

The value of using carefully worked-out methods 
of employment and wage payment is lost unless an 
equal amount of thought is expended on finding out 
whether employees are “making good.” The 
measurement of the production of each worker as 
carried on in many factories serves as one check. 
Absentee records, if kept as to cause, and accident 
records are also indicative of the value of an em- 
ployee. A record for each employee, giving the above 
facts, serves as a basis for promotion or dismissal and 
is far more accurate than dependence on the word of 
some one person. 

The failure of employees may be due to con- 
ditions which are outside their control. It is im- 


146 Business and the Church 


portant for industrial concerns of all kinds to check 
up the conduct of their business to determine whether 
or not conditions are such as to hinder the work which 
is going on there. Absentee records may reveal the 
fact that there is an undue amount of sickness in cer- 
tain departments, and a further check will show the 
reason. Accident records tell whether or not un- 
guarded machines or bad light are taking toll. A 
high turnover in normal times usually shows some- 
thing wrong either in employment methods, in the 
wage level, in the supervising personnel, or in the 
methods of certain departments. A continuing sur- 
vey is necessary. 

The hours of work in a plant are seldom set 
scientifically, although such experiment as has been 
made seems to indicate that research can show the 
length of day during which the output is largest 
without excessive effort and in which accidents are at 
a minimum. The effect of shortening the day in 
certain industries is quite different from what it is 
in others. Where the machine sets the pace, shorten- 
ing the hours cuts down production, although even 
here, loss through accidents and spoiled materials 
and the lowered vitality of the workers offsets the 
gain in output on a long-hour schedule. As to other 
occupations, Dr. P. S. Florence, who has investigated 
the subject extensively both in England and America, 
summarizes his conclusions as follows: “Reduction 
from a 12-hour to a 10-hour basis results in in- 
creased daily output; further reduction to an 8-hour 


Research in Industry 147 


basis results in at least maintaining this increased 
daily output; further reduction below 8 hours, while 
increasing the hourly rate of output seems to de- 
crease the total daily output.” Overtime has the 
same effect as long hours. 

The health of workers is a practical concern of 
industry because poor health brings with it absentee- 
ism, accidents, and wastage, and finally increases turn- 
over, all of which affect production unfavorably. In 
maintaining the working force in good health, pre- 
ventive measures are conceded to be best, although 
remedial measures are by no means neglected. Cer- 
tain industries, such as mining and chemical manu- 
facturing, carry special health hazards. The dis- 
tribution of light and air are important factors in 
health. The methods of work and hours of work 
may be such as to increase or lessen fatigue. It is the 
function of research to analyze the situation in various 
kinds of industry and in specific plans and to apply 
scientific knowledge to solving health problems. 

Fatigue results from various causes; in fact, from 
any combination of circumstances which hastens the 
destructive processes of the body to such an extent 
that the process of recovery cannot keep up with 
them. Waste products fill the blood-stream faster 
that they can be eliminated. Fatigue may either be 
local, in one set of muscles, or general. Medicine 
and psychology have both made fatigue a subject of 
research, and certain tentative conclusions have been 
reached. These conclusions have been applied to in- 


148 Business and the Church 


dustry in various ways. The curve of accidents has 
been charted to show that accident incidence is greater 
as fatigue increases, late in the day. Rest periods 
have been introduced at intervals which have proved 
suitable for various kinds of work and have served to 
lessen fatigue and increase production. In some 
cases, more than half the working day is spent in 
resting, and yet production is increased. Occasionally 
men and women on piece-work object to taking rest 
periods because they cannot believe that they will not 
lose by it. Output has invariably gone up even when 
this spirit of opposition existed. 

In the spinning department of a textile mill, turn- 
over was reduced and production increased by giving 
four rest periods daily. The turnover in the rest 
of the mill had been running at 5 or 6 per cent while 
in the spinning-room it was 250 per cent. Most of 
the workers were suffering from foot-trouble, and 
many complained of neuritis. There were occasional 
outbursts of irritability. After some experiment, a 
system was worked out by which four rest periods 
of ten minutes each were given. During this time, 
the men lay down. The response was immediate: 
the spinners began to earn a bonus for the first time, 
absenteeism dropped, and in the twelve months of 
the investigation there was no turnover at all except 
where men left town or were ill. 

Consideration for the mental health of workers 1s 
only in its beginning. The experiments of Dr. Mayo 
indicate a close relationship between the output of 


Research in Industry 149 


the worker and his state of mind. Fatigue, he says, 
induces pessimistic reverie, and the mental disorder 
which may grow from it is “the most fertile cause 
of industrial and social unrest.” 

The use of seats of proper height and shape has 
served to lessen fatigue and has corrected the posture 
at work. Various improvements in methods of work 
have resulted in an increased production with de- 
creased effort. 

In certain industries the lighting is very import- 
ant. One textile firm reported that when it installed 
a modern lighting system in its looping department, 
production increased 4 per cent. In this same de- 
partment, with the old lighting methods, one half of 
the girls who were taken on for training left before 
their training period was up; after the installation of 
the new lights, nine out of ten stayed on the job. In 
other firms, accidents have been lessened and waste 
from spoiled articles has been cut down. The bene- 
fits in relief from eye-strain from such changes is 
indeterminable but is undoubtedly very great. 

The safety movement is one of the outstanding 
industrial developments of this century. The first 
step toward control of accidents is taken when they 
are recorded by cause, severity, and nature of injury 
as well as by occupation of injured employee. This 
is the simplest sort of research but is often ignored. 
This record when carefully kept shows just how to go 
about making necessary changes; it also shows how 
great the loss is to the factory; and finally it indi- 


150 Business and the Church 


cates whether accidents are being checked by the 
methods adopted for that purpose. As a rule such 
records are maintained and interpreted by single 
plants, although state labor departments which ad- 
minister workmen’s compensation acts keep and pub- 
lish records of compensable accidents. There are 
several instances in which national or local trade as~ 
sociations compile the records of their members. 

Personnel research of the kind which has been dis- 
cussed in the previous pages receives a great deal of 
impetus from work done in certain universities. The 
Industrial Research Department of the University 
of Pennsylvania has perhaps taken the lead in co- 
Operating with employers in this direction. Working 
with the Philadelphia Industrial Association, several 
continuing studies have been made. The first of 
these was on labor turnover. The Division of Co- 
Gperative Research of Carnegie Institute of Tech- 
nology, while carrying on its work somewhat differ- 
ently, has worked with many firms on personnel 
problems. Johns Hopkins University has indicated 
its readiness to codperate with Baltimore employers. 
Courses in employment psychology and personnel ad- 
ministration are given in most large universities, and 
the professors and graduate students have directed 
a number of personnel studies in codperating com- 
panies. 

Various investigations of a general nature have 
been put out by certain organizations. These at- 


Research in Industry 151 


tempt to check the results of the operation of various 
plans, such as profit-sharing and stock purchase. 
They are as a rule little more than summaries of 
existing practice. 

There are other organizations which serve as clear- 
ing-houses for information concerning personnel pro- 
cedure and experience. The American Management 
Association, the Taylor Society, the National In- 
dustrial Conference Board, the Policy Service Bureau 
of the Metropolitan Life Insurance Company, and 
the Personnel Research Federation are among this 
number. The last named organization, as its name 
indicates, is a federation of research organizations. 
It publishes the Journal of Personnel Research in 
which original investigations in the field of person- 
nel appear. The Annals of the American Academy 
of Political and Social Science contain personnel 
studies from time to time. Several federal depart- 
ments, chief among which is the Bureau of Labor 
Statistics, also publish considerable personnel infor- 
mation. 

No complete list of industrial companies doing 
personnel research is available; the following are 
some of the outstanding examples; American Rolling 
Mills, Middletown, Ohio; Atlantic Refining Com- 
pany, Philadelphia; Consolidated Gas Company, 
New York; Consolidated Gas, Electric Light and 
Power Company of Baltimore; Samuel Insul Proper- 
ties; Lord & Taylor and R. H. Macy & Co., New 


P52 Business and the Church 


York; Pennsylvania Railroad System; Philadelphia 
Rapid Transit Company, Philadelphia; Walworth 
Manufacturing Company, Boston. 

The chief accomplishment of personnel research 
is the demonstration that a very real problem exists 
and an indication of the general lines along which 
further study should proceed. There is a general 
impression among progressive employers that noth- 
ing in personnel procedure is settled. There is an 
increasing tendency toward open-mindedness and 
search for underlying truths. In so far as industry 
is able to discover these truths through research and 
experience, it is contributing not only to the process 
of physical production, but also to an enhancement 
of the spiritual values which are, after all, the only 
enduring things of life. 


WHAT THE MINISTER CAN DO WITH 
LABOR 


ALBERT F. COYLE 
Eprror, LocomotivE ENGINEERS’ JoURNAL 


Mr. Coyle is internationally known as the editor of the largest 
labor magazine in America, the Brotherhood of Locomotive 
Engineers’ Journal, and executive secretary of the All-American 
Codperative Commission, a national clearing-house for informa- 
tion regarding all kinds of codperative enterprises. He is also 
editor of the Weekly Codperative News Service. 

After preparing himself for the law at Stanford University, 
Mr. Coyle pursued graduate studies in political science, sociology, 
and religion at Yale University, supplemented by first-hand 
observation of political and industrial problems in Europe. He 
is the author of Evidence on Conditions in Ireland and of fre- 
quent monographs and magazine articles on industrial and 
economic problems and the codperative movement, international 
relations, and economic conditions in Russia, where he remained 
on duty as the last American relief worker following the revolu- 
ticn. 

Mr. Coyle has not confined himself to theories but is the 
founder and director of several important codperative enterprises. 

Mr. Coyle is well known in public forums throughout the 
country for his trenchant discussions of codperation, world peace, 
and labor problems. 


WHAT THE MINISTER CAN DO WITH 
LABOR 


ALBERT F. Coyte 


I have been asked to write on what the minister 
can do for labor. I am tempted to reply: not half 
so much as labor can do for the minister and his 
church. For to-day the church is on trial. As Dr. 
John McDowell has well said, “If the church is to 
be a vital factor in modern life, it must Christianize 
industry; it must make clear the fact that it has a 
mission in an industrial age, and it must prosecute 
that mission with untiring energy and unflinching 
earnestness.” 

Frankly, I am not interested in discussing what 
the minister can do for labor, but rather what he can 
do with labor. The clergyman who patronizes labor 
will find himself shunned by all self-respecting work- 
ingmen, while he who codperates with labor can 
achieve tremendous things for the kingdom of God. 

All the tomes of theology cannot save the church 
if it fails to conquer the spirit of materialism that ' 
dominates our industrial civilization. For modern 
industry is frankly pagan. Its chief criterion of 
success is making money. It is not concerned with 
human values except as they contribute to material- 

155 


156 Business and the Church | 


istic gains. To be sure, many of the men who man- 
age industry are of high character. Personally they 
may not want to place profits above human welfare, 
but corporately they must meet the ruthless com- 
petition of the most selfish and unscrupulous 
employer. The minister who in this day and age 
is content to save a few individual souls here and 
there while this pagan industrial system is wreck- 
ing and ruining human lives by the tens of thousands 
is not a worthy ambassador of the Master Carpenter 
who came to put immortal hope into the hearts 
of the masses that are weary and heavy-laden. The 
time has gone by—if it ever existed—when the 
Good Samaritan can do his full Christian duty by 
picking up the pieces of human wreckage along the 
highway of life. The minister or layman who takes 


his religion seriously to-day cannot be content until 


he has cleared the highway of the thieves who inflict 
such wrongs on his helpless fellow-men, even when 
the respectable members of his own church are 
found to be sharing in the loot. 

There is only one way the minister can ever Chris- 
tianize industry, and that is by Christianizing the men 
engaged in industry. And since 98 per cent of the 
men in industry are workers and only 2 per cent are 

employers, the minister must, if he is not to fail in 
his mission, win the multitude of ordinary working 
people to a personal allegiance to Jesus Christ. This 
is no easy task. It is immeasurably more difficult 
to-day than it was a generation ago, because the warm 


What the Minister Can Do With Labor 157 


spiritual impulses of millions of workers have been 
ruthlessly crushed by the industrial Moloch. They 
have become dehumanized cogs in a soulless indus- 
trial machine. In fact, in the industries where labor 
is unorganized, these human cogs do not get nearly 
the consideration given cogs of steel; they are not 
tended and cared for and housed as are the purely 
mechanical parts of the machine, since their deprecia- 
tion is not charged up against corporate profits, and 
when worn out they can be junked without requiring 
a new corporate investment; merely society as a 
whole suffers that loss. 

The harsh fact is that the great mass of city 
workers to-day are outside of the church and indif- 
ferent to its influence. (I am not speaking of the 
worker in the small community, who is seldom the 
victim of bitter industrial exploitation. Nor am I 
referring to the foreign-born workers, who are turn- 
ing away by thousands from the only church they 
have ever known, the church that has shaped the 
lives of their ancestors for generations.) Let me 
quote the reply given by one of the most dis- 
tinguished labor leaders America has ever produced, 
who was reared in a native-born Protestant 100 per 
cent American family, when I asked his opinion as to 
what labor thinks of the church: 


Labor does not think very much of the church because 
the church does not think much of labor. Always in any 
trouble between labor and capital, the influence of the 


158 Business and the Church 


churches has largely been on the side of capital, and this is 
easily explained when you realize that they depend on 
capital for their support. 


Before the minister can do anything with labor, 
both parties have to understand each other. The 
average worker does not understand the lofty ideals 
of the church, any more than the average clergyman 
understands the worthy purposes of organized labor. 
The minister who tries to codperate with labor will 
find in the mind of the unchurched industrial worker 
a conception of the church that runs about as follows: 


The church exists for the well clothed and the well fed, 
and not for the man in overalls. 

Why should the worker be interested in the church, 
since the church is not interested in labor? 

If you don’t believe the churches exist for the business 
men and employers, look at their boards of trustees—bank- 
ers and Rotarians and chamber-of-commerce magnates and 
corporation lawyers, but nobody on them who sweats for 
his daily bread. 

Don’t tell me the churches believe in brotherhood; there’s 
more real brotherhood in my union in one week than in the 
average church in a year, 

Labor doesn’t owe anything to the church, for the church 
has never stood up to help labor get a decent wage or the 
eight-hour day or anything else where a real scrap was in- 


volved with the Big Boys who pay the preacher’s salary. 


These are not imaginary quotations. They are 
what reputable labor leaders have told me regarding 


What the Minister Can Do With Labor 159 


their opinion of the church. When I reminded the 
last critic that the Interchurch report in the steel 
strike had been of inestimable value to labor in com- 
pelling improved working conditions in that industry, 
he replied, “Yes, but that’s an exception; that man 
McConnell who made that report seems to be a 
square fellow, but theyll run him out of the church 
yet if he doesn’t keep his mouth shut.” 

A labor executive who has a keenly logical mind 
replied that after visiting a number of big city 
churches he concluded that “the ministers have noth- 
ing for the workers.” “I have divided the preachers 
up into four classes,” he continued. “Some simply 
do not understand the workers; they try to reach 
them, but haven’t the humility and human sympathy 
to do so. Then there are the indifferent ministers, 
who preach fine sermons and hold up high ideals, 
without any sincere concern for the people who never 
eat chicken for Sunday dinner. Then there’s the 
patronizing preacher, who always makes me sick at 
the stomach; and the fourth kind is the preacher 
openly hostile to labor-unions who associates with 
the big-business class.” 

Now, possibly all of these labor leaders are entire- » 
ly wrong in their criticism of the church; and again, 
perhaps they are partly right. In any event, these 
men, and millions more like them, cannot be reached 
by the church until this gulf of misunderstanding is — 
bridged. And because of the suspicions that have 
been engendered, the churchmen will have to carry 


160 Business and the Church 


most of the planks for the bridge-building. But that 
fact should never daunt a sincere follower of the 
Great Physician. He deliberately sought out the 
men who most needed His ministrations, no matter 
where they were. He even told His disciples to go 
out into the highways and byways and compel them 
to come in. 

One of my favorite pictures in Europe is not found 
in National Gallery or Ryks Museum; it hangs in 
the humble parish-house of City Road Chapel, in 
London, where John and Charles Wesley preached, 
and depicts the man who saved England preaching to 
a great throng of begrimed coal-miners at the gaping 
mouth of the mine-pit. The great evangels of sal- 
vation, from Amos and Hosea to Savonarola, Wyclif, 
Wesley, Whitefield, and Jerry McCauley, have not 
waited for men to come to them and hear them 
preach. They have gone wherever needy souls could 
be reached with the message of salvation, and have 
pursued them through rebuffs and misunderstand- 
ings and personal hardships with an unquenchable 
love that would not let go. The hungry human 
soul is quick to respond to that kind of love. The 
common people will still come to hear that kind 
of minister gladly. And somehow they are un- 
cannily able to detect and spurn the counterfeit 
article. | 

There is only one way to get working-men into 
your church, and that is to convince them, not by 
words but by deeds, that you are profoundly con- 


What the Minister Can Do With Labor 161 


cerned about their temporal and spiritual welfare. 


And of the two, interest in their temporal welfare 


must come first, for even the Master Teacher fed 
the multitude before He urged it to accept spiritual 
salvation. 

Is the minister really willing to work with labor? 
Does he really seek fellowship with those who toil, 
as did the Carpenter of Galilee? Is he willing to 
have as his closest companions such working-men as 
Jesus chose to go with him as his most intimate 
friends—three or four fishermen, a farm laborer, 
and one who had lost his job because of his radical 
political opinions? Dr. Albert W. Palmer is right 
when he says that a year in a factory would be good 
training for every preacher. 

Know the working-man first-hand at close range. — 
Give him as close a place as did the Master in your 
church and home life. See that he is on your official 
board, that he speaks to your people on Labor Sunday . 
or other services, that he puts his feet under your din- 
ner-table as often as does the influential employer. 
Have a red-blooded minister appointed as fraternal 
delegate to your central labor-union. (You will be 
surprised how readily such a proffer will be accept- 
ed.) Get the workers’ point of view by reading one 
or two good labor papers, for you can never learn 
their needs and aspirations from the daily press or 
the Literary Digest. Unless you are ready to do 
these things, don’t pretend that you want to work 
with labor. 


162 Business and the Church 


The minister who does not feel his blood run hot 
when respectable business men deny their employees 
a decent living wage is temperamentally unfit to work 
with labor. “They that love the Lord hate evil,” 
even when it is groomed in linen and broadcloth. The 
supreme tragedy of our modern religious life is the 
church’s slowness to recognize and espouse the 
cause of those who suffer burdens too grievous to be 
borne. Only the minister with a passion for social 
justice has a message that workers will listen to. 
For how can a clergyman be sincere in his appeal to 
labor unless he wants the humblest industrial work- 
er to enjoy as great an abundance of life as he wants 
for himself and his own family, and will fight to 
see that he gets it? 

It is not enough to have a social creed which you 
dust off and read to the congregation once a year. 
Put it to work, Send it walking about the busy city 
streets in shoe-leather. The only social creed worth 
having is one that impels you to consecrate yourself 
to the service of the unprivileged and exploited mem- 
bers of society, even as did He who sought out the 
lost sheep of the house of Israel. 

An amazing discovery awaits many ministers who 
wonder why workers never crowd into their pews. 
They do not know that the fundamental ideals of 
every labor organization are identical with the three 


great truths on which Christ founded His church: the — 


universal brotherhood of men, the supremacy of 
service as the main motive of life, and the match- 


iii 


What the Minister Can Do With Labor 163 


less worth of human personality. Call them divine 
or human, these are the very principles that every 
labor-union is striving to achieve in the rough every- 
day world of brick and steel where men toil to win 
bread and butter for their families. The church 
must either confess and practise these ideals or else 
disown its Founder! 

What a challenge this identity of purpose between 
labor and the church presents to the minister who 
wants to reach the masses of labor! How tragically 
few workers ever suspect that the church has any- 
thing in common with them and their problems! 
Think for a moment of the tremendous possibilities 
for human progress if organized religion were to 
come out openly and assert its intent to unite with 
labor in the realization of human brotherhood. That 
would mean a joint campaign to eliminate the social 
injustice which now makes brotherhood impossible. 
It would mean the banishment of the strife, the 
selfishness, the greed which now characterize an un- 
brotherly and autocratic industrial system. 

Or suppose that the church joined with labor to 
make a practical application of the Master’s teaching 
that human personality is the supreme value in this 
life and hereafter. That would mean a united ef- 
fort to safeguard and ennoble human life by de- 
manding a living wage for all producers, prevent- 
ing child labor, protecting women in industry, and 
abolishing brutalizingly long hours of labor. Twelve 
million people in this country live in a state of 


164 Business and the Church 


chronic poverty. The labor-union, not the church, 
is fighting for them in the front rank, with the church 
nowhere in sight. But if the church really takes its 
Christ seriously, why should n’t this multitude of im- 
poverished humanity call upon the church to help the 
unions secure for it an equitable share of the wealth 
its toil creates? 

Or let the minister who wants to work with labor 
enlist it in the common cause of establishing the law 
of service, instead of greed for money-making as the 
mainspring of our industrial life. The Judean work- 
ing-man who declared that the greatest man is he 
who serves his fellows most unselfishly would be 
blacklisted as a communist agitator in our big open- 
shop factories. Yet our industrial civilization will 
never become Christianized, nay, it will inevitably 
stifle and prostitute the religion now preached in our 
churches, unless service to humanity supplants profits 
squeezed from humanity as the chief motive of our 
economic life. 

Dare the church be Christian? Dare it line up with 
labor in opposing 'the whole profit-taking industrial 
system? To do so will cut right to the purse-core of 
practically every wealthy supporter of the church. 
And yet there is no other road to a Christian indus- 
trial order. This means the socialization of some of 
our most powerful trusts. It means substituting co- 
operation for capitalism throughout commerce and 
industry. It means a moral revolution in our social 


What the Minister Can Do With Labor 165 


and religious thinking, even to the abandonment of 
the dollar-sign as the criterion of personal success. 

When the church makes these dynamic social ideals 
of Jesus a first charge on its conscience, it will not 
longer need to worry about what it can do with labor. 
It will find the workers eager to come into the fold 
and help achieve the common goal. 

The minister who wants to realize the great Chris- 
tian precepts shared by labor will have to imbue 
the theological seminaries with a new passion for the 
social gospel. Only thus can such ideals impregnate 
the church of to-morrow. I recently had cause to 
make a study of the number of great theological sem- 
inaries which are equipping their students with an in- 
telligent understanding of the critical problems faced 
by the worker in our pagan industrial system. The 
number can be counted on about half the fingers of 
one hand. 

Finally, the minister who would work with labor 
to realize these Christian ideals will need a vast sup- 
ply of courage. He may have to pay the price paid 
by the Master for his stand. For men will prosecute 
him and revile him and say all manner of evil against 
him falsely. Even his own self-complacent fellows 
may brand him as a Bolshevik—the modern method 
of crucifying the prophet who preaches the word of 
God with the bark on it. 

It is going to take the stanchest devotion fer you 
to put these dynamic social ideals into practice, but 


166 Business and the Church 


you will not gain the allegiance of the working-men; 
and you do not deserve it, unless you will pay that 
price. 

I should like to see labor working with the church 
and the church working with labor, for I believe that 
each has something valuable to contribute to the 
other. Labor can keep the aims of the church prac- 
tical and useful, just as the church can give the labor 
movement a spiritual impulse which it too often lacks. 
But there is only one way to attract the workers 
into the church, and that is for the church to re- 
discover the sort of gospel preached by its Founder, 
and apply His teachings, cost what it may. 

When the ministers of to-day learn to become 
again like the great Master Carpenter of Nazareth, 
labor and the church will no longer be divided. They 
will be found in the same pathway of service, striv- 
ing together to build up the kingdom of God on 
earth. 


WORKING WITH LABOR IN THE 
ELECTRICAL INDUSTRY 


LOUIS KOSSUTH COMSTOCK 
ELeEctTrIcAL ENGINEER 


Louis Kossuth Comstock is an electrical engineer by profes- 
sion. For many years, as head of the L. K. Comstock Co., he 
has been occupied with numerous and important electrical instal- 
lations in various parts of the United States, having been one 
of the pioneers in this industry. For a long time he has been 
interested in the labor problem and was the leading spirit in the 
dificult matter of organizing, in 1920, the Council on Industrial 
Relations for the Electrical Construction Industry. He has been 
chairman of this body since its inception. In 1926 he sug- 
gested the possibility and desirability of using index-numbers, 
particularly those of commodity prices, as a logical basis for 
fixing the wages of labor. He has been chairman of the Arbi- 
tration Court of the New York Building Congress since its 
organization in 1922. During the war he served as a member 
of the War Industries Board. He has occupied many other 
public and semi-public positions. 

He is a director of the Merchants Association of New York, 
and a national councillor of the United States Chamber of 
Commerce. 


WORKING WITH LABOR IN THE 
ELECTRICAL INDUSTRY 


L. K. Comstock 


Modern society, with here and there a gleam of 
intelligence, is seeking some sort of an adjustment 
between capital and labor, between employer and 
employed. The age-old attitude of each toward the 
other has been antagonism, according to some. I 
think it more correct to speak of the attitude of the 
employer as one of exploitation, conscious or uncon- 
scious, and of the attitude of the employed as the dull 
antagonism of despair and defenselessness. 

Capital’s slogan might well be: 


Some for the glories of this world ; and some 
Sigh for the Prophet’s Paradise to come; 
Ah, take the Cash, and let the Credit go, 
Nor heed the rumble of a distant Drum. 


And labor’s condition of mind might correspond to 
Ecclesiastes, 2, 11; 


Then I looked on all the works that my hands had 
wrought, and on the labor that I had labored to do; and be- 
hold, all was vanity and vexation of spirit, and there was no 
profit under the sun. 

169 


170 


Business and the Church 


The two points of view here set forth are as wide 
apart as the astronomical theories of Ptolemzus and 
Kepler, and yet the world is beginning to feel that 
its industrial well-being is somewhat dependent on 
narrowing the divergence between them. 

It is always well in discussing a problem of great 
complexity to endeavor to state the problem. A 
problem well stated is a problem half solved. In 
the beginning let us set down a few axioms: 


(1) 


Industrial society to-day is extremely complex 
and highly organized. 


(2) The interdependence of individuals and of 


(3) 


peoples throughout the world in securing the 
goods desired has become increasingly close. 
The demand for greater production is becom- 
ing universal. 


(4) The productive units of society have become 


massed in order to meet the ever increasing 
demands of society itself. 


(5) There is a high degree of specialization and 


(6) 


standardization of the materials, processes, 
and agents of production. 

The present industrial order is a highly com- 
mercialized one. 


(7) The present industrial order is a highly com- 


(8) 
(9) 


petitive one. 
The present industrial order is a highly cap- 
italized one. 
Absentee ownership and control of industry 
has grown with the ever expanding and in- 


With Labor in the Electrical Industry 171 


creasingly complex system of conducting in- 
dustry. 

(10) The lack of proprietary interest among the 
masses of workers is a matter of the greatest 
significance. 

(11) There is a notable division of the active parties 
in industry into the two great groups of em- 
ployers and employed. 

The foregoing eleven axioms represent in a rough 
way the outstanding features of our present-day in- 
dustrial society. We may find fault with our indus- 
trial society, the development of which makes these 
axioms possible, but we cannot dodge the responsi- 
bility which rests upon us for oiling the wheels of 
this industrial machine upon which the present gen- 
eration, and perhaps many still to come, must de- 
pend. We must make the best endeavor possible to 
scrape off the barnacles of traditional methods of 
thought respecting the employment of labor and to 
see clearly, to think with imagination, and to so order 
our ways as to afford each member of the industrial 
organism the maximum of life according to his ability 
for assimilation. Exploitation of labor must be aban- 
doned because it is uneconomical. Soldiering on the 
job must be abandoned because it is uneconomical. 
Craftsmanship in its best sense must be the goal for 
the laboring man because through it he makes his 
largest contribution to the general productivity of the 
industrial scheme. 

It ought not to be necessary to prove that willing 


172 Business and the Church 


and sympathetic codperation between employer and 
employee will make a contribution toward lessening 
the complexity referred to in our first axiom. But if 
proof be required, one need only to remember that 
every encounter between employer and employee re- 
sults either in increased labor turnover or dissatis- 
faction of the employed or both, and both results add 
complexity. 

The second axiom of interdependence calls for 
close codperation, because interdependence becomes a 
shadow if codperation is absent. 

The third axiom, the demand for greater produc- 
tion, requires close and still closer codperation if the 
demand is to be satisfied. The same is even more 
true of the fourth. 

Specialization, the subject of the fifth axiom, is of 
the very essence of codperation because the work of 
many is required for a single unit of production. 

The demand for codperation between capital and 
labor, as a conclusion from the sixth and seventh 
axioms, may not be quite so obvious unless we are 
willing to grant that the present highly commercial- 
ized and competitive industrial order is desirable and 
will continue. 

The eighth axiom, referring to a highly capitalized 
industrial order, implies conservation of capital, and 
conservation of capital implies codperation with labor. 

The ninth and tenth axioms, negative in form, 
seem to imply a more or less complete absence of 
codperation. 


With Labor in the Electrical Industry 173 


The eleventh axiom brings us to the real meat of 
the discussion: the marked division of the active par- 
ties in industry. 

It is a fair conclusion from these axioms, represent- 
ing as they do the state of the industrial order, that 
the key to the solution lies in willing and sympathetic 
codperation. Is there an open-sesame to codpera- 
tion? To the clear-sighted there is. Its achievement 
lies in the future. 

The worker demands economic independence, a 
constantly rising standard of living. Through cen- 
turies of struggle he has come to perceive his eco- 
nomic value, a value enhanced or at least more clear- 
ly perceived through collective action. The employer 
resists the worker’s demand. Through centuries of 
struggle, from the building of the medieval towns to 
the modern evolution of the industrial order, the em- 
ployer has come to look upon industrial processes as 
his own peculiar domain. Both employer and em- 
ployee, in their opposite points of view, have been 
developing naturally, though perhaps unconsciously, 
toward an evolution in industry which will more and 
more depend, through sheer economic necessity, upon 
a more intelligent interdependence, an interdepend- 
ence which will increasingly amount to a sympathetic 
codperation. Emotionalism applied to the solution 
of labor problems accomplishes little. Clear percep- 
tion of the trend of modern currents of thought con- 
cerning the ever-increasing economic pressure on the 
individual must guide the struggle between capital 


174 Business and the Church 


and labor and must surely point the way from a 
struggle for group advantage to the more intelligent 
struggle for industrial codperation. Capital is hoard- 
ed labor, and labor is capital. Capital competes with 
capital and labor with labor, and the result is severe 
economic pressure. But when capital competes with 
labor, and labor with capital, the economic pressure 
increases to the bursting-point. 

Substitute codperation for competition, and a de- 
crease in economic pressure follows. 

The signs multiply that the competition of capital 
with capital is decreasing. Observe the consolida- 
tions of banks in recent years, the consolidations of 
industrial enterprises and public utilities, and the im- 
pending consolidations of railroads. The signs also 
multiply that the competition of labor with labor is 
decreasing. Observe the beginnings of a hostile at- 
titude on the part of organized labor toward juris- 
dictional disputes. Hand in hand with these signs 
of decreased competition within the domains of cap- 
ital and of labor, there has sprung up a competition 
of labor with capital in the realm of banking insur- 
ance. In proportion as this competition becomes ef- 
fective it ought to have good results, because it will 
have a tendency to curb radicalism in labor and to cul- 
tivate a better understanding on the part of labor of 
the problems involved in conserving capital—another 
expression for stored-up reserve labor. 

The road to any general change of front in the 
economic world is beset with the greatest difficul- 


With Labor in the Electrical Industry 175 


ties, because men’s minds, taken in the mass, are le- 
thargic and prone to look upon changes as revolution 
rather than evolution. There are many faint of heart 
in all societies, and these are easily discouraged when 
the object of their desire seems a long way off or 
when their cherished dreams seem dissipated and lost 
in fog or brain-fag. But things have a way of going 
on and on regardless of the individual. Years ago 
Carlyle wrote, “This that they call the organization 
of labor is the universal vital problem of the world.” 

How can employers and employees be brought to 
see that reasoning processes in the settlement of dis- 
putes are more advantageous to all concerned than 
fisticuffs, broken heads, indictments, and jails, to say 
nothing of loss of production, profits, and wages? 
The caveman knew no law except the law of the 
bludgeon, but the caveman and his law of force have 
about disappeared or are at least disappearing. Thirty 
years ago the union leader was a good deal of a 
caveman, and so was the employer, but the employer 
usually had some statute laws behind him, whereas 
the union man was working out his salvation true to 
human form by the use of force because statute law 
enacted for his protection was not yet. Throughout 
history the enactment of law has meant the crystal- 
lization of the common thought of the day, and 
whenever statute law runs ahead of or counter to the 
common thought, a painful human experience results, 
as, for instance, the prohibition law; and whenever 
statute law lags behind the common thought, an 


176 Business and the Church 


equally painful experience results, as, for instance, 
the child-labor law. | 

And so I look upon the labor movement in the 
large asa protest or revolt against a social order grow- 
ing more and more archaic. With the growth day by 
day, little by little, of the idea of democracy, must 
go the enlargement of labor’s sphere of activity, the 
increase in society’s respect for manual labor, and 
the growth of the knowledge which the laboring 
man must have to fit himself for his new position and 
responsibilities. 

The problems involved in the employment of la- 
bor are not static, but dynamic. The art of codpera- 
tion is not a static, but a dynamic, art. If the efforts 
now making for increasing the codperation between 
employer and employee are destined to meet with 
success, then we are in the midst of evolution, we are 
evolving a new industrial order. 

As a contribution to this evolution of industrial 
codperation, I consider the Council on Industrial Re- 
lations for the Electrical Construction Industry. 

This council, set up by the joint action of employ- 
ers and employees, operating but little more than five 
years, has succeeded in producing a strikeless indus- 
try, an industry without an organized strike or lock- 
out from ocean to ocean. Such an event deserves 
more than passing attention. The employers and 
employees who have set up this council are both of 
them national organizations; more correctly speak- 
ing, international, because Canada is included. The 


With Labor in the Electrical Industry 177 


very idea of the council was at first strongly opposed 
by large and influential groups in both organizations; 
it aroused much antagonism and was fiercely debated, 
because it was misunderstood in some quarters, sus- 
pected of ulterior designs in others, and regarded as 
a pipe-dream by many hard-headed wiseacres who 
believed that the antagonism of labor toward capital 
was as fixed as the laws of the Medes and Persians 
and as natural and recurring a phenomenon as the 
tides of the sea. 

But happily this age-old attitude toward anything 
new has softened with the lapse of time; misunder- 
standing has been followed by understanding, sus- 
picion has faded away, and faith is beginning to take 
its place—the hard-headed are gradually becoming 
open-minded; and the council, with a record of 
achievement behind it, has gained a definite and 
honorable place in the ranks of the electrical con- 
struction industry. 

Those who first set up the ideal of the council 
strongly believed in the inherent honesty of purpose 
of the rank and file of employer and employee, but 
above all they were powerfully impressed by the 
wisdom—aye, the necessity—of codperation—of or- 
ganized codperation. 

Individualistic tendencies must at times be curbed 
or brought under direction. They saw no reason why 
disputes could not be argued out in the open with 
all the cards on the table, even though the points of 
view might be as wide apart as the poles. They un- 


178 Business and the Church 


derstood the fact that the bases of the solution of any 
problem or dispute lie first in the statement of a case, 
mutually acceptable; then in a definition of terms; 
and then in a narrowing down of the divergence of 
the points of view. They did not believe in meet- 
ing assertion with assertion and calling it an argu- 
ment——to be followed with ultimatums and then with 
super-ultimatums; this kind of negotiation they were 
ready to relegate to the scrap-heap. 

In this frame of mind, a Declaration of Principles 
was formulated. These principles were formulated 
by a duly authorized committee of ten, five employ- 
ers and five employees. In due time the principles 
were adopted by the two international organizations; 
thereupon they were adopted as the underlying law 
of the council: 


Mediation—the settlement of disputes by reason instead 
of fighting—is the function with which the Council is 
generally and closely associated. The prime interest of the 
Council, however, is not mediation but the discovery and 
removal of the causes of disputes which call for mediation. 
Causes are discovered by a study of effects, by research and 
diagnosis, and for that reason the Council has placed itself 
at the service of the industry as mediator. By rendering 
this service the Council promotes its own ends, for medi- 
ation affords it an opportunity to deal with realities, and 
add to its fund of factual knowledge. 

Broadly speaking, the Council’s purpose is to substitute 
harmony for strife in the industry. Mediation serves that 


With Labor in the Electrical Industry 179 


purpose. The machinery created by the Council for medi- 
ation makes necessary the discussion of their differences by 
local groups of employers and employees. In the great 
majority of cases such discussion produces adjustments. 

Before the Council was ready to function mentally and 
physically, it was necessary for its members to be in sub- 
stantial agreement on, fundamentals. The Council, after 
many deliberations, sitting as a joint committee, and at 
other times in groups of two, or three, or four, had arrived 
at an agreement on the following fundamental ideas: 

(1) Strikes and lockouts are undesirable from every 
point of view. 

(2) No dispute can arise between employer and em- 
ployee which cannot be settled in friendly nego- 
tiation, by conciliation or by arbitration, provided 
the parties to the dispute have the will honestly to 
try one or more of these methods. 

(3) The industry cannot fail to thrive on codperation 
between employer and employee, and will surely 
languish if such coéperation is absent. 

(4) Codperation resulting in mutual good will is the 
key to increased production and better craftsman- 
ship. 

(5) The road to the highest efficiency of the individual 
working unit lies through the field of frank co- 
operation and fair-dealing. 

(6) Local union leadership must be greatly improved. 

(7) The mere display of power is the last thing in the 
world that insures the success of an association, an 
organization, or an industry. 

(8) Labor-unions, and associations dealing with them, 


180 Business and the Church 


4 


must stop thinking so much about organization and 
think very much more about the essentials of the 
cause of the working-man. 

(9) Labor-unions and associations dealing with them 
must declare their purpose to bring about three 
things: 

(a) Good working conditions. 

(b) Good wages. 

(c) The highest possible standard of crafts- 
manship. 

(10) Labor-unions and associations dealing with them 
must plan their campaigns wholly on the basis of 
the service they are each capable of rendering. 

(11) If a labor-union or an association is to make itself 
desirable and indispensable and cherished for all 
time, the way to do it is to forget itself in the 
widest possible service of its cause. 

To answer caviling criticism, and to state more clearly 
the essence of the Council idea, the following statements 
of what the Council is and what the Council is not are set 
down in opposition: 

It is not an organization possessed of mandatory powers. 

It is an agency for promoting harmony, good will, and 
cooperation. 

It is not an organization for unionizing employees where 
unions do not exist. 

It is an agency for the peaceful settlement of industrial 
disputes. 

It is not an organization for the establishment of a na- 
tional wage. 

It is an agency for promoting the unification of the fun- 
damentals of labor agreements. 


With Labor in the Electrical Industry 181 


It is not an organization seeking power in order to domi- 
nate. 

It is an agency for the promotion of the common welfare 
by the elimination of strife. 

It is not an organization for the primary purpose of 
settling disputes. 

It is an agency for removing the cause of dispute. 

It is not an organization for protecting the rights and 
immunities of labor-unions; it is not an organization for 
protecting the rights and privileges of employers. 

It is an organization which designs to do justice between 
employer and employee, to foster a spirit of good will, to 
build an industry whose right hand is direction and whose 
left hand is execution, where each hand knows the mind 
that directs the other and hence both are in perfect tune and 
accord. 


When the council sat for the first time as a court, 
it heard a wage case from Detroit. The union had 
been receiving $8 a day and was asking for $10, a 
request denied by the employer. Fruitless negotia- 
tions followed, and an organized strike was close at 
hand. The council was new; it had never settled a 
wage dispute. Both sides were prevailed upon to 
submit their dispute to the council; first trying, un- 
successfully, the method of conciliation. The dis- 
pute concerned wages alone, uncomplicated with trad- 
ing demands concerning conditions of employment. 
Having given much study to the application of index- 
numbers to wage adjustment, the council determined 
to settle the dispute by that method. 


182 Business and the Church 


The average wholesale price index-number for the year 
1914 is 100. 

The average wholesale price index-number for the 12 
months from December 1, 1919, to December 1, 1920 
(the November, 1920, index-number being the last avail- 
able), is 248.333. 

The ratio between these two, an increase of 148.333 per 
cent indicates the increase in the cost of living over that 
in 1914 and gives the correct ratio between the wages paid 
in 1914 and the wages that should be paid to-day. 

The average wage for journeymen electricians in the 
four cities mentioned for the year 1914 was, as already 
stated, $4.56. 

It would seem proper to increase the whole wage in the 
ratio established by the index-numbers, but the Council 
recognizes the obligation which now rests upon every citi- 
zen regardless of his economic or social status to share the 
burden of the national debt by making sacrifices wherever 
possible. 

In its Research Report No. 30 of December, 1920, the 
National Industrial Conference Board publishes a budget 
for the skilled workman’s family, in which the expenditures 
are apportioned 79.6 per cent to the cost of subsistence and 
20.4 per cent to “other purposes.” 

It would be unjust and oppressive to reduce the allow- 
ance made for the imperative necessities of life. The sac- 
rifice must be made therefore in the allowance for satis- 
fying the worker’s other requirements. The Council there- 
fore carries the 20.4 per cent of the budget apportioned to 
the satisfaction of the worker’s needs other than imperative 
necessities into the present wage as a constant expressed in 


With Labor in the Electrical Industry 183 


dollars. In other words, only that part of the wage ap- 
portioned to meet the cost of imperative necessities has 
been increased in the ratio fixed by the index-numbers. 

Thus the Council establishes a wage of $9.94 for jour- 
neymen electricians as a fair wage in its relation to the 
present cost of living, the latter as fixed by the wholesale 
price index-numbers, 

In the interest of simplifying the make-up of pay-rolls 
the Council increases the $9.94 to $10.00. 


The index-number method of adjustment has been 
used many times since by the council and probably 
will continue to be used. But experience teaches that 
this method must be used with great caution in the 
electrical industry or in any of the industries form- 
ing the industrial group known as the building trades. 
If there were a council functioning for the building 
trades as a whole, extraordinary caution in the use of 
index-numbers for the adjustment of wages would 
not be necessary. Extra care in their use becomes 
necessary when they are used in only one or two of 
about thirty trades composing the building trades. 
High wages in one trade in the building trades pow- 
erfully affects others in the minds of all concerned; 
therefore, if those high wages, though perhaps fully 
justified, have been fixed by unscientific considera- 
tion, they will powerfully affect the adjustment of 
wages in another trade, in ways that greatly disturb 
a normal use of index-numbers. The council has 
recognized this fact in the Hamilton decision: 


184 Business and the Church 


It is also shown that the wage scales prevailing in the 
building trades in Hamilton for other crafts range from 
85 cents to $1.1214 per hour. The Council believes it to 
be economically wrong to fix wages for electricians at the 
lowest point in any particular locality, because the lowest 
paid trades have uniformly shown stagnation in growth, 
due to the unattractiveness of the monetary return. 


And in the Baltimore decision: 


After carefully reviewing the briefs in the case and the 
various conditions leading up to this dispute, the Council 
deems it essentially fair to give some consideration to sim- 
ilar conditions which obtain in other comparable centers. 
The Council also has considered to what extent, if at all, 
wages of skilled electricians should as a matter of economic 
policy be lower than the wages of other skilled mechanics, 
other conditions being similar, or lower than the average 
for electricians in cities where practically similar conditions 
prevail. 


And in the Terre Haute decision: 


The Council is of the opinion, however, that it would be 
an economic fallacy to fix the wages for electricians at the 
lowest notch in any particular locality, because the lowest 
paid trade in the building industry has uniformly tended 
toward stagnation in growth, due to the unattractiveness of 
the monetary return as compared with other callings. The 
lowest-paid trade tends toward disintegration, because the 
best mechanics seek other kinds of work. 


In the process of studying the briefs and oral tes- 
timony submitted to the council in a number of cases 


With Labor in the Electrical Industry 185 | 


with particular reference to the causes of cessation 
of work, whether by strike or lockout, the council 
has concluded that trade agreements carrying spe- 
cific dates of expiration are the most common cause 
for wage disputes and consequently cessation of work, 
and, conversely, continuing agreements tend to elim- 
inate interruptions of work. 

It has therefore recommended in a number of de- 
cisions a form of agreement. which has no termina- 
tion except by service of notice by one party to the 
agreement on the other of a desire to terminate. 
This notice must be served twelve months in advance 
of the date for termination. This plan has been 
found to work very well for all concerned, because 
it gives ample time for changes of mind and for 
reconciliation. 

The council is often faced with the question: What 
is a fair wage? In the present state of the public 
mind, it may not be possible to answer this question 
in a very satisfactory or intelligent way. The coun- 
cil does not know. The employer may think he 
knows, but does not. The employee may think he 
knows, but does not. If statistical conditions per- 
mitted one to compare the wages in the bricklayers’ 
or carpenters’ trade in 1825 with the corresponding 
wages in 1925 by means of the commodity price in- 
dex-number, it is probable that the 1925 wage would 
be found capable of buying more of the goods con- 
sumed by the laboring-man than the 1825 wage. And 
yet this discrepancy attracts little or no attention. 


186 Business and the Church 


But when the 1925 wage is compared with the 1914 
wage by means of the index-number, it attracts more 
than ordinary attention, because it is found that the 
1925 wage buys more than 40 per cent more goods 
than the 1914 wage. Notwithstanding this fact, 
there seems to be everywhere a certain degree of 
equanimity about it; it seems to be taken for granted 
that wages are rather satisfactory despite the fact that 
the real as distinguished from the monetary wage is 
much higher now than in 1914. How else can this 
be accounted for except by the tacit and inarticulate 
admission on the part of the employing public that 
the present high real wages of labor represent the 
share labor is receiving in the recent vast increase of 
national wealth, to the accumulation of which labor 
has powerfully contributed? Sharing in the increased 
national wealth by labor is not a predetermined act, 
but it is one of those economic phenomena which have 
been vaguely observable since the industrial system 
came into being after the Napoleonic Wars, helped 
along, to be sure, by the rise of labor-unions. 

The council is now at work endeavoring to pro- 
duce a formula for wage adjustment by index-num- 
bers which will take this fact into consideration. One 
of the hampering obstructions is the difficulty of se- 
curing the necessary reliable data properly compen- 
sated by the changing dollar value. 

All decisions of the council when sitting as a court 
require a unanimous vote. To some this seems sur- 
prising. The question has often been asked: What 


With Labor in the Electrical Industry 187 


do you do when you cannot get a unanimous vote? 
Up to date this question is academic; we have never 
yet failed to get a unanimous vote. When and if we 
fail, our only recourse is to publish the facts with 
the reasons for our failure. 

No account of the council would be fair nor would 
it do justice to the subject without a word of high 
praise for the spirit and the mental attitude with 
which the ten members have approached their tasks, 
and a few words of the highest commendation for the 
lofty detachment with which the members, without 
any surrender of principle, have viewed the ques- 
tions brought before them for consideration. 


A COOPERATIVE INDUSTRIAL 
EXPERIMENT 


H. S. DENNISON 


PRESIDENT AND DiRECTOR 
Tue Dennison ManuractTurinc Co. 


Mr. Dennison was graduated from Harvard University with 
the degree of A. B. in 1899. 

In addition to the management of his business, Mr. Dennison 
has given an enormous amount of service to civic, state, and 
national affairs. He is a trustee of Antioch College, Yellow 
Springs, Ohio; was director of the Service Relations Division 
of the Post-Office Department at Washington; is an ex-president 
of the Taylor Society, New York; and director of the Amer- 
ican Management Association, New York. He was a member 
of President Wilson’s first Industrial Conference, in 1921, and 
assistant director of the Division of Planning and Statistics of 
the Shipping Board, and of the War Trade and Industries 
Board during the World War. 

He is co-author of “Profit Sharing.” 


A COOPERATIVE INDUSTRIAL 
EXPERIMENT 


Henry DEnnIson 


The Dennison Manufacturing Company, in com- 
mon with many others in the United States, had its 
inception in a small household industry. To this 
household industry was brought the mechanical gen- 
ius of two men, the merchandising ability of another, 
and the thrifty spirit first of a good Yankee family 
and, later, of a good Yankee community. 

The basis of the original business was the making 
of paper boxes for jewelers’ use. Then it developed 
that there were other items constantly used in the 
jewelers’ trade, such as cards for the mounting of 
jewelry and small tags for marking jewelry, all of 
which also could be made from paper and with com- 
paratively little difficulty. 

The small jewelers’ tag suggested the making of 
marking devices for other purposes, and from these, 
various other types of tags finally came. In 1863 
E. W. Dennison hit upon the idea of adding a paper 
patch to strengthen the hole through which the tag 
string passes, and with this idea the shipping-tag 

_ business really began. 
Ig! 


192 Business and the Church 


The original enterprise went through the usual 
financial struggle experienced by those who pioneer 
with little or no capital. With the patent granted 
upon the shipping-tag described above, however, the 
business began to develop and prosper. 

The company was incorporated in 1878; there 
were but a few stockholders, virtually all of whom 
had grown up with the business and with Mr. Den- 
nison. As time went on, Mr. Dennison made it pos- 
sible for a number of his so-called leading men to 
become stockholders, either by giving them stock out- 
right or by allowing them to purchase it on easy 
terms. These stockholders were all active in the 
business and formed a small but happy family. 

At the beginning of the present century, however, 
a considerable proportion of these holdings had be- 
come scattered, large blocks passing into the hands 
of persons not employed by the company. There 
were, in fact, about two hundred stockholders alto- 
gether, although the largest holdings were in the 
hands of eight people. These eight people were 
sometimes in accord and sometimes not, and, un- 
fortunately, were geographically so scattered as to 
make a real integration of ideas impossible in any 
case. 

Out of this experience, and out of a philosophy of 
management which will be outlined briefly below, the 
conviction grew that the success and perpetuation of 
the company could best be insured if the leading men 


A Co6éperative Industrial Experiment 193 


and women employed in the business might actually 
control it and share in the profits. 

Within an industry every one does some manag- 
ing. The elevator man is managing in some degree 
when he makes the stops at the proper floors in the 
proper way. The chief executive does a great deal 
of managing in the process of making any major de- 
cision. The range of managing is virtually from 
zero to 100 per cent, with no one exactly at either 
the lower or the upper limit. 

The job of managing may itself be broken down 
in terms of the analysis that follows: 


Understanding 
(a) Observing 
(Watching the operation, supervising, includ- 
ing the selection of what to observe and the 
method of recording, mental or physical) 
(b) Evaluating 
(Interpreting the observed facts; relating them 
to other facts and to policies; determining 
their relative significance) 
Devising 
(c) Conceiving 
(Imaging possibilities—goals) 
(d) Analyzing 
(Analyzing goals and possibilities and relating 
observed and evaluated facts thereto) 
(e) Contriving 
(Determining methods, means, incentives, 
operatives) 


194 Business and the Church 


Persuading 
(f) Teaching 
(Establishing the necessary understandings of 
goals, means, methods, and incentives) 
(g) Inducing 
(Inspiring—“‘instructing the desires”; the 
emotional partner to teaching) 


The process called codrdination is composed of parts 
of e, f, and g. 


Complaints, disclosed faults, are results of (a); (b) 
is their acceptance and appreciation; (c) “pro- 
poses” their correction. 


Since managing is compounded of the elements 
just shown, and is inherent to some degree in a wide 
range of activities, two fundamental questions are: 
Who shall choose the managers? and then in turn, 
Who shall choose the choosers? Z—The Dennison an- 
swer to the one is, a resident board of directors: to 
the other, that only management can select the direc- 
tors. 

It is not merely that abstract reasoning points in 
that direction; experience hints strongly that efforts 
to get out from under the artificial system of in- 
vestors’ control will be persistent and ingenious. An 
inside group frequently forms itself and controls the 
control, focusing stockholders’ votes by one means or 
another. Only for financial purposes, not for good 
operation, is a concern considered effective if fully 


A Coéperative Industrial Experiment 195 


controlled by absentee investors and run by hired 
men. But because of our ingrained custom of meas- 
uring success by the money that is made, some con- 
cerns are thought of as successful merely when flota- 
tions have been successfully based upon them, though 
as operating organizations they may reek to heaven. 
For real success in productive effort we all believe in 
the old style of firm whose members had their time 
and their money tied up in its fate. And investors 
and others of the financial men, when trouble is in 
sight, seek for him who can get into the game all 
over, who will both manage and control, who will be 
management hired by management. 

In 1911 the Dennison Manufacturing Company 
was reorganized on the fundamentals just set forth; 
a codrdinated plan has been worked out to make these 
fundamentals operative. 

Most of the men and women who sell and make 
Dennison goods are like partners in the business, 
partners sharing in both management and profits. 
The control of the company is wholly in the hands 
of those who are daily connected with its interests: 
those who are only investors have no voice in its af- 
fairs. Its financial structure is modified from the 
traditional form in recognition of the practical facts 
of ownership and investment; for stockholders not 
directly connected with a business seldom are inter- 
ested in its management so long as dividends are 
paid. As dividends are a matter of principal im- 
portance to them, they tend to pick financial men 


196 Business and the Church 


who, not being expert in production management or 
marketing methods, tend to leave the managers 
alone as long as dividends are forthcoming. The 
following table shows the corporation’s structure: 


Class of Nature of 
Stockholders Group Stock 

First Preferred Investors only Non-voting;  trans- 
ferable 

Second preferred Investors only Non-voting;  trans- 
ferable 

Managerial Employees of five] Possesses sole voting 

Industrial years’ service or over,| power; non-transfer- 

Partners whose work is of a|able 

managerial nature 
Employee Employees of three|Non-voting; non- 
Industrial years’ service or over| transferable 


Partners and of all ranks not 
in managerial group 


Distribution to the partners is made not in cash 
but in non-transferable stock. This stock pays a 
varying rate of dividend, whatever is warranted by 
the condition of the business each year. When a 
partner of either group leaves the company, his stock 
is exchanged for second preferred, a non-voting, fixed 
dividend, transferable stock. 

The managerial partners are relatively few in 
number and are actively engaged in the business. 
Only employees who have had five years’ service 
and who hold positions of a managerial nature are 
eligible for membership in this group. 

The directors of the company are elected by the 


A Coéperative Industrial Experiment 197 


managerial partners. Voting for directors is by un- 
signed ballots. The directors are all Dennison men, 
and each one has a definite, full-time, managerial 
responsibility. At present, there are six directors, 
constituting, as it were, the executive committee of 
the managerial partners. 

Two restrictions are placed on the otherwise com- 
plete authority of the managerial partners: 


(1) If, over a period of years, the partners fail in 
their responsibility to produce preferred divi- 
dends to the full amount, control reverts to the 
first preferred stockholders. 

(2) Any managerial partner who does not consist- 
ently maintain managerial grade as determined 
by a yearly check-up of himself and his job, 
through job-study and committee advice, may be 
dropped from the managerial group. 


The industrial partnership plan has never been 
and never was meant to be primarily a profit-sharing 
plan. It is first a management-sharing plan. 

The foregoing discussion has pointed out that the 
sole voting control of the business is in the hands 
of the managerial industrial partners. It has also 
been stated that the managerial partners elect the di- 
rectors each year. The theory back of this phase of 
management sharing is that absentee control is en- 
tirely to be avoided. The directors are the executive 
committee of the controlling partners, and all are 
active citizens of the industry. The managerial part- 


198 Business and the Church 


ners constitute the audience to whom the directors 
are always openly accountable. These partners may 
either concur in or question the actions of the direc- 
tors. The votes of any particular year can indicate 
pretty conclusively the reaction of the partners and 
afford an early hint of an adverse rating of individ- 
ual directors. Asan extreme measure an entirely new 
board of directors might be elected. It is probable, 
however, that if such a condition is ever reached, the 
business will have been in such shape that the control 
will have reverted to the holders of the first pre- 
ferred stock as provided for in the agreement. 

Coupled with this direct control, profit-sharing for 
the managerial group does constitute a real incen- 
tive for extraordinary effort. The success with which 
the organization has weathered the extremes of pros- 
perity and depression since the plan was put into 
operation has lifted it out of the realm of pure con- 
jecture and established its practical usefulness. 

Management sharing and profit-sharing at first 
affected only the relatively small managerial group; 
and even as late as 1919 the part to be played by 
the non-managerial employees was quite undeter- 
mined. An increased opportunity for the non-man- 
agerial employees to share in the management of the 
business, and an actual participation in the profits 
arising from such codperation, have, however, now 
been in force for approximately seven years. 

But while it would seem that profit-sharing and 
management-sharing plans should apply both to the 


A Coéperative Industrial Experiment 199 


managerial staff and to the manual workers, it by 
no means follows that these plans can be made to 
apply to both groups in exactly the same form. 

In 1919 the works committee was established as 
part of the organization structure of the Dennison 
Manufacturing Company. The part played by the 
employees themselves in bringing about their com- 
plete share in the partnership constitutes one of the 
most significant chapters in the history of the com- 
pany. They not only built the structure of the works 
committee, but later, through the works committee, 
laid out the plan for employee profit-sharing. 

In its development, management has become func- 
tionalized; and staff experts of one kind or another 
have been added to aid the line man in the carrying 
on of the particular function which is his responsi- 
bility. It is as a staff expert that the works commit- 
tee may primarily be considered. No one knows so 
much about some of the particular problems of the 
worker on the job as the worker on the job. As an 
adviser on this range of problems, the works com- 
mittee bears the same relationship to the organiza- 
tion as does the chemist or the engineer. 

And the works committee has another function. 
In a real partnership, all the partners must be inter- 
ested and have a chance to express their interest. For 
the partners not in supervisory positions, the works 
committee serves as a focus of this interest and as 
an orderly organized medium through which this in- 
terest may be expressed. 


200 Business and the Church 


The structure provides for standing subcommittees 
of the works committee and for conference commit- 
tees partially composed of works-committee members 
and partially of management members. There are 
subcommittees on constitution and by-laws, codpera- 
tive buying, and many other matters; and there are 
such conference committees as hours, wages and 
promotions, unemployment, suggestions, health and 
safety, and other subjects. The works-committee 
structure of course supplies procedure for the han- 
dling of grievances. 

The works committee recognized that if profits 
were to be distributed among the employees not in 
supervisory positions, these profits must be earned by 
a contribution over and above ordinary efforts put 
into daily tasks. They realized it is not often to be 
expected that production is to be increased by an in- 
centive so indirect and distant as a share in surplus 
profits. There are, however, several ways other than 
just producing more by which an employee may make 
money for the company. There are four general 
classes into which these ways fall: 


(1) An improved standard of workmanship. 

(2) An increased watchfulness in the saving of 
waste. 

(3) A saving of supervision. 

(4) Codperation with each other. 


Considering such factors, it was possible to con- 
ceive of a profit-sharing plan that pays its own 


A Co6éperative Industrial Experiment 201 


freight, and they did not wish to suggest one which 
did not. There are five major elements in the plan 
adopted: 


(1) 


(2) 


(3) 


(4) 


(5) 


All Dennison employees over eighteen years of 
age, and who are not managerial industrial part- 
ners, shall at the end of two years’ service be 
made employee industrial partners. 

At the end of three years’ service such employee 
industrial partners shall be entitled to share in 
the distribution of the Employees’ Industrial 
Partnership Fund. 

The Employees’ Industrial Partnership Fund 
shall be equal to one third of the amount which 
would otherwise be distributed in stock among 
the managerial industrial partners. 

This fund shall be distributed in the form of 
non-transferable, non-voting stock; this stock, 
however, not to be in the preferred class, but 
one which shall risk the fluctuations of busi- 
ness. 

The amount which each employee industrial 
partner receives shall vary with the length of 
service of each individual. 


The prerequisite of two years’ continuous service 
was imposed because it was felt that the industrial 
partnership should be limited to persons fully in 
touch with the present life of the company and who 
are reasonably to be supposed to be permanently 


placed. 


202 Business and the Church 


The stipulation that the Employees’ Industrial 
Partnership Fund shall be distributed in the form 
of non-transferable, non-voting stock was incorpo- 
rated for several reasons. Stock ownership carries 
with it a sense of proprietorship, and in the long run, 
therefore, is a lasting influence making for first-rate 
effort; stock distribution constitutes a device whereby 
the idea of saving is cumulative, as are the savings 
themselves, whereas cash bonuses, on the other hand, 
may be dissipated each year; a stock that risks the 
ups and downs of business fluctuations makes part- 
nership and participation a much more significant 
thing than a stock bearing a fixed rate of return; the 
non-transferable feature prevents cashing in and pro- 
vides for cumulative effects of steady saving; and 
finally, the stock is non-voting because non-supervis- 
ing employees should not be asked to assume a vot- 
ing responsibility which their knowledge will not 
allow them to carry easily. Their share in manage- 
ment may be fully satisfied by the proper develop- 
ment of the works committee. 

Length of service was taken as the basis of dis- 
tribution, since the older employees can contribute 
most directly under the four categories of savings in 
waste and in supervision, of improved quality of 
work, and of codperation with each other. The older 
employees also teach the younger ones by example 
and by their longer range viewpoint. 

The operation of the managerial industrial part- 
nership since 1911, and especially during the years 


A Coéperative Industrial Experiment 203 


of lush war profits and the starvation months of 1921, 
leaves no doubt as to its feasibility and value as a 
practical working arrangement. The employee in- 
dustrial partnership plan is approaching the end of 
a seven-year experimental period. To be rigidly 
scientific, all that can be offered is a suspended judg- 
ment. To register a general feeling, opinion is very 
largely favorable. 


F Age See | 
$ Pee Mae eka vei 
BD 54 yaalde ran 


THE HUMAN SIDE OF PRODUCTION 


J. M. LARKIN 


AssISTANT TO PRESIDENT, BETHLEHEM STEEL CoRPORATION 


Mr. Larkin has been with the Bethlehem Steel Corporation 
and its subsidiaries for a period of twenty years, his early years 
having been spent in the shops, drafting-room, and executive 
offices. For the last eight years he has been in charge of the 
industrial-relations activities for the entire corporation, employ- 
ing about seventy thousand workers, 

Mr. Larkin has served as an officer in many outside organiza- 
tions fostering personnel work, and was a few years ago presi- 
dent of the Industrial Relations Association of America, which 
later merged with and is now known as the American Manage- 
ment Association. His present position is assistant to the presi- 
dent of the Bethlehem Steel Corporation, in which position 
he has general supervision over all industrial relations activities. 


THE HUMAN SIDE OF PRODUCTION 
J. M. Larxin 


Various functions are necessary to the conduct of 
business. Purchasing, selling, manufacturing, and 
distribution are often thought of as being concerned 
for the most part with the product itself. In consid- 
ering the human side of business, especially the hu- 
man side of production, we are turning our thoughts 
upon the people who make the products, as distin- 
guished from the things they are making. When we 
consider the fact that almost 50 per cent of the gross 
revenue received from the sale of steel and iron 
products of all kinds goes out to the people who 
make the goods, we can at once appreciate the im- 
portance of the human side of business. 

In the early stages of industrial and manufactur- 
ing development this phase of the business became 
more or less overlooked in the all-absorbing desire 
to perfect and increase the volume of production. So 
long as the organization of business was confined to 
small units, there was little trouble. But when the 
workshops of ten or twelve friends, neighbors, and 
intimates developed into the factory or plant with 
hundreds or thousands of workers recruited from 

207 


208 Business and the Church 


various distant places and with various modes of liv- 
ing and thought, the problem of providing for the 
ambitions, needs, and rights of the people who make 
things came to require just as much attention as the 
things which they made. 

Forward-looking management realized that these 
changes necessitated the adoption of new policies 
which would develop the good will of workers to- 
ward their work. Furthermore, the good will of its 
customers and of the public are requisites of a suc- 
cessful concern to-day. Modern industry has be- 
come a big codperative ambition, in the realization of 
which every supervisor and every employee becomes 
a factor. 

In developing its relations with its workers the 
Bethlehem Steel Corporation did not suddenly or 
simultaneously attempt to install a large number of 
so-called beneficial schemes. On the other hand 
they developed, one by one, as occasions seemed to 
require, plans which were designed to meet and care 
for certain definite conditions. These conditions are 
in the main the chief wants of a worker in so far as 
his personal relation with his job is concerned. 

It has been well said that the average worker in 
the main wants five things. They are: 


(1) A steady job. 
(2) Adequate real wages. 
(3) A good supervisor. 


The Human Side of Production 209 


(4) An individual and collective voice about all of 
his conditions. 
(5) A chance to rise on his merits. 


Let us then see how the various functions of the 
company’s industrial relations activities fit with these 
desires. 

Anything that affects the steadiness of the job for 
the average worker is serious. Therefore the com- 
pany has planned to provide, as far as possible, a 
steady job for its employees. First, there has been 
established in each plant an up-to-date, carefully ad- 
ministered employment department for mobilizing 
and interviewing the prospective employees, and for 
the transfer, promotion, or termination of present 
employees. In this department every attempt is 
made to accord the new employee a friendly recep- 
tion and to help him fit into the job for which he is 
best qualified. 

The treatment accorded the new as well as the 
terminating employee by the employment depart- 
ment is of vital importance, and particular stress has 
been laid on this in the Bethlehem organization. 
From the hands of the foreman or the individual de- 
partment head has been removed the right to com- 
pletely discharge a man from the plant, not so much 
because of the foreman’s arbitrary abuse of this pow- 
er, as because of the opportunity of another person 
to study general plant conditions and to know what 


210 Business and the Church 


is best for the company as a whole. The policy has 
been established of requiring the department head to 
return the employee—dissatisfied or unsatisfactory, 
as the case may be—to the employment department, 
where under the guidance of trained men he is trans- 
ferred to the best advantage to himself and the com- 
pany. This policy has resulted in the retention of 
many an employee who felt when leaving a depart- 
ment that he wanted to quit the company, and con- 
sequently has materially aided in keeping down the 
labor turnover. To uncover in the interviewing of 
terminating employees the real facts in the case re- 
quires tact, understanding, and an almost unusual 
faculty for gaining confidence. The employment 
department fails or succeeds in this phase of its work 
according to the individual who fills the position. 

There are two conditions under which the steadi- 
ness of the job may be interfered with and over 
which the employee himself has little control; one is 
in the case of sickness; the other, of accident. To 
assist the employee in case of sickness or death, in 
each of the plants there is in operation a plan for 
affording financial relief. 

The interpretation of the various state compensa- 
tion acts in rendering to injured employees aid in dis- 
tress is a matter of extreme importance. It is Beth- 
lehem’s policy to carry its disciplinary and educa- 
tional activities to the extreme limit to prevent acci- 
dents and to forestall serious results from them. This 
is done through accident-prevention campaigns, first- 


The Human Side of Production 211 


aid instruction, and plant permanent safety-commit- 
tees. These permanent safety-committees consist of 
employees of the various operating departments, 
whose duty is, in addition to their regular work, to 
function as safety inspectors in their departments, 
for which they receive additional compensation. In 
its own, as well as in the employees’ interest, the 
company keeps down to a minimum the loss, from ac- 
cidents, of time, health, and money; and with the 
team-play exemplified by the employees in the last 
five years, preventable accidents have been reduced 
50 per cent. Ina word, the policy for keeping acci- 
dent loss at a minimum is to take every possible means 
to prevent accidents. Once accidents occur, however, 
the compensation law is interpreted in its broadest 
sense, and if a doubt exists, the company leans to- 
ward paying without protest. 

Another condition over which the employee has 
no control is that of old age, and when, after a period 
of years of service in Bethlehem’s employ, an em- 
ployee finds it necessary to retire, he may do so under 
the pension plan, which provides reasonable cash as- 
sistance. This plan was put into effect on January 1, 
1923, and provides that after an employee has ren- 
dered twenty-five years of service and reaches the 
age of sixty-five he may retire on a pension. 

In order that every employee shall receive fair 
and just treatment, the pension plan is administered 
at local plants by joint committee composed of rep- 
resentatives of the employees and management, and 


ZY Business and the Church 


centrally by a board of six company officers appointed 
by the president; and each case receives individual and 
careful consideration. At the present time there are 
about 950 active cases totaling over $420,000 a year. 

Another important aspect of Bethlehem’s human- 
relations program is the opportunity which the plant 
doctor has to be of service in dealing with employees. 
Medical departments have been organized in all of 
the plants for the convenience of the employees. 
Sympathetic understanding on the part of the plant 
doctor is of equal importance with technical skill, and 
the medical department can contribute much toward 
promoting the ideal of the steady job. 

Believing that steady living and a steady job are 
synonymous, the company helps its employees to pur- 
chase homes on easy partial payments. 

All lines of industry are more or less subject to the 
peaks and valleys of business demands, and any steps 
which employers can take to iron out these peaks or 
valleys are of great benefit to the community at large. 
Some progress in this direction has been made where 
companies have adopted in times of business depres- 
sion the policy of dividing among a maximum num- 
ber of regular employees the available work on a 
part-time basis, instead of laying off large forces and 
thus swelling the ranks of the totally unemployed. 

Unquestionably the procedure of laying off large 
forces would be the most efficient for immediate re- 
lief, but the policy of spreading the available em- 
ployment over a maximum force in the long run pays 


The Human Side of Production 213 


the employer through the retention of a working 
force which greatly facilitates increased operations 
upon the revival of business. This is the policy which 
the Bethlehem management has followed, and 
which, it is believed, affords to the workers and the 
company the greatest possible benefits in such times. 

Probably no economic subject has received such at- 
tention in the last five years as the problem of stabil- 
izing the business cycle. Government commissions, 
economists, research bureaus, and business concerns 
have all given time and study to the problem and 
have tried to point out ways of meeting the trouble. 
Of course complete stabilization can never be reached, 
but even fair progress in this direction will eliminate 
one of the most objectionable aspects of our social 
and economic conditions, and will do much to pro- 
mote industrial happiness. 

A fundamental question like wages will never 
cease to be in some measure contentious. Wages are 
affected by such changing influences as cost, com- 
petition, production, the demand for the product, 
and a variety of economic factors which are different 
for different industries. 

An adequate wage is a wage that is sufficient to 
afford an employee and his family a decent standard 
of living with a margin for laying something aside. 
This can best be afforded the employee by relating 
his wages to performance. He will thus be rewarded 
in proportion to his skill and to the service he ren- 
ders, as indicated by quantity and quality of output. 


214 Business and the Church 


This policy is opposed to the practice which seeks to 
group together at a uniform wage, regardless of 
individual performance, large bodies of employees, 
classed in a trade, and scattered in various widely 
separated plants; such grouping inevitably tends to 
discourage effort and to reduce individual output to 
a standard set by the least efficient worker. 

This policy is commonly called bonus, tonnage, 
premium, or piece-work, and on one or the other 
of these the majority of Bethlehem employees are 
compensated. Under this plan each individual to 
some extent fixes the adequacy of his own compensa- 
tion. 

The employee receiving a wage which allows him 
to save a part of his earnings, thus becoming a thrifty 
and self-sustaining member of the community, is a 
valuable asset to both the company and the commu- 
nity. Any assistance which industry can render the 
employee in maintaining a savings account is good 
business. 

Believing that in addition to saving a part of his 
earnings it is desirable to have the employee invest in 
the company he works for, Bethlehem established in 
1924 an employees? saving and stock ownership plan. 
This plan provides that an employee may purchase 
the 7 per cent cumulative preferred stock of the 
company by small deductions from his wages. A 
further inducement is offered him to hold the stock 
and remain in the employ of the company by the pay- 
ment of a special bonus to holders of the stock, so 


The Human Side of Production 215 


as to encourage thrift and to keep down the labor 
turnover by having the employee retain his financial 
interest in the company. 

A good supervisor is not only desired by the em- 
ployee, but is required by the management, if indus- 
try is to be properly interpreted to the employees. 
The supervisor is in daily contact with the employee 
and reflects in his attitude the company policy. The 
successful operation of his department will depend 
upon his broad-mindedness, his patience, and his will- 
ingness to talk over his problems with his men and to 
maintain with them a close, friendly contact. He 
should regard his department as a team of which 
every employee is working asa member. This spirit 
is the aim of Bethlehem’s supervisors. 

If an industrial organization is to get team-play, 
if it is to know what its employees are thinking about 
and is to make known to them the things they are 
entitled to know in order to be real members of the 
team and to pull together for the betterment of their 
conditions and the success of the company, there must 
be a will and a way. 

One of the most effective agencies for promoting 
good will between employers and employees is 
through some well organized method of periodic 
conference. To accomplish this, Bethlehem has 
adopted a plan of employee representation. 

Bethlehem’s experience with works council, or em- 
ployee representation, has been that under it both 
management and men have been able to do their 


216 Business and the Church 


tasks better because of the mutual understanding that 
results from it. 

The plan is primarily a system which provides for 
the election by shops or departments of representa- 
tives by and from among the employees to meet and 
deal with the management for the discussion, regula- 
tion, and adjustment of matters having to do with 
the conditions which may arise out of employment. 

Regarding the machinery for the prevention and 
adjustment of differences, it is notable that a closer 
relationship between management and men has been 
established by personal contact between the two 
groups of representatives. 

Work managers meet regularly with the em- 
ployees’ representatives and point out business pros- 
pects and employment conditions and thus are able to 
convey a picture of the situation and to put informa- 
tion into the hands of the employees which would not 
otherwise be obtainable. The president of the cor- 
poration makes a trip every year to meet representa- 
tives of the employees and the management, when 
he explains business conditions and also the applica- 
tion of the income accruing from the business of the 
corporation. 

The problem of continuous employment has been 
given a great deal of attention, especially during re- 
cent business depressions. Many revisions in hourly 
schedules, so as equitably to distribute work as well 
as wages, have been initiated by the employees’ rep- 
resentatives. 


oe 


The Human Side of Production 217 


Where large numbers of men are dealt with, it is 
natural that some feeling of inequality of treatment 
should arise; but under the operation of the plan 
the employees’ representatives have quickly brought 
the attention of the management to individual cases 
requiring adjustment. 

Can anything be more important than to know 
that this is one of the fixed policies of any company? 
Important as it is to executives, it is equally important 
to every employee. There is no room in industry to- 
day for advancement by favor, nor should there be 
any place for influences that tend to maintain dis- 
tinctions and reduce the status of those who would 
otherwise advance. Individual advancement on 
merit is the principle to which Bethlehem subscribes. 

The steel industry as a whole has experienced, un- 
der the guidance of broad-visioned men of long prac- 
tical experience, men who have risen within the in- 
dustry and know its problems, a monumental growth 
in this country; and the development of its human re- 
lations has not lagged, and will continue to play a 
big part in its future prosperity. Its policy to pay 
good wages, to provide for reasonable hours of work, 
and to give a chance for expression and conference, 
and an opportunity for saving and partnership; its 
chances for promotion, and its policy of training 
good supervisors—all are forward-looking achieve. 
ments in an industry of great public importance. 

The real benefits of an industrial-relations pro- 
gram cannot be measured by the results accruing 


218 Business and the Church 


either to employees or management alone, but rather 
by the general advantage of both, or of the plant and 
community as a whole, by which mutual understand- 
ing is accomplished. 

An example of what work in human relationship 
can accomplish is furnished by reviewing Bethlehem’s 
experience in a plant which it acquired three years 
ago. The turnover of labor has been reduced from 
an average of 30 per cent monthly to a present aver- 
age of about 8 per cent monthly. Whereas the plant 
formerly depended upon a labor supply shipped in 
from remote places, its present needs are supplied 
from voluntary applications. 

The number of days lost to employees through 
accidents has been reduced from twenty-two days 
per hundred men employed to eight days. When 
Bethlehem took over the plant, the thirty beds in 
the hospital were all occupied. To-day the average 
occupancy is less than ten. 

Men in the plant have been put on a profit-shar- 
ing basis and are now paid on tonnage and premium 
and piece-work rate systems, where before they were 
largely on straight hourly and daily pay basis. 

The company owned several streets of houses. 
These were put in good condition and the occupants 
encouraged to keep the places as clean as houses any- 
where in the country. This work was all done with- 
out losing money, even though the average rental on 
typical five-room houses is as low as $12.50 a month. 

Two hundred and ninety-six new and separate 


The Human Side of Production 219 


houses were built to sell at cost to employees at an 
average price of $4200. These houses contain from 
four to six rooms, are built in twenty different styles, 
and are surrounded by concrete roads and pavements. 
The lawns are planted, and a large plot is laid out 
in the middle of the development as a playground 
for children. 

Many welfare buildings have been put up at con- 
venient locations throughout the plant to provide the 
men with proper facilities to care for their clothes 
during the day and to give them proper places to 
wash up before starting home. 

In commenting on the situation Mr. E. G. Grace, 
president of the company, said: 


The most striking feature of the results which have been 
realized at this plant has been, not so much the economies 
due to the expenditures of money, but achievements in what 
might be called the field of human engineering. Even 
before the results from the large expenditure of money had 
been realized, the results from the improvement in the 
morale and spirit of the men had been such as to make a 
plant which had been losing money pay its own way. 


And so it may be answered, to the question, Why? 
that personnel work with human relations plays just 
as important a part in manufacturing as its mechan- 
ical phases, and has just as much influence on costs 
and on the ability to produce and sell the manufac- 
tured products as have mechanical or physical im- 
provements. 


220 Business and the Church 


In carrying out and putting these plans into prac- 
tice, as in any other task set for accomplishment, or- 
ganization and direction are necessary. Therefore 
the Bethlehem Steel Corporation has a central direct- 
ing department, attached to the office of the president, 
which codrdinates and directs these human policies 
of our work in each one of our separate plants em- 
ploying in the aggregate 70,000 employees. 

The industrial relations department, which has 
charge of human relations in the corporation, is super- 
vised in each local plant by one of the general man- 
ager’s assistants. In this department of our work 
we are giving constant thought and attention to hu- 
man problems as they affect production, and are help- 
ing to shape and direct a policy which will facilitate, 
alike for management and for employees, a satisfac- 
tory accomplishment of production. 

There has been comment that the workers in a shop 
would rather have larger pay-envelopes and less 
“benefit stuff.” If human-relations work is treated 
as “benefit stuff,” real men will resent it, and the 
“stuff? will undoubtedly fail to accomplish its ob- 
ject. If, on the other hand, human-relations activi- 
ties are directed toward the definite object of creat- 
ing a company spirit, a team spirit, which results in 
lower labor costs, lower turnover costs, higher effi- 
ciency on the part of the men, then the work is not 
only successful from the point of view of the com- 
pany, but the men themselves, led by the more intel- 
ligent workers, come to have more confidence in the 


The Human Side of Production 221 


company because they realize that lower costs mean 
more business, steadier jobs, and regular pay-checks. 
And the most important part of this is that lower to- 
tal labor costs on the company’s balance-sheet secured 
by improved labor conditions do not result in smaller 
pay-envelopes for the individual workers, but, con- 
versely, they tend to increase the size of the pay- 
envelopes. 

There is no last word in dealing with human re- 
lationships nor is it contended that the Bethlehem 
plan is perfect, but it is felt that the plan has ac- 
complished results in eliminating misunderstandings 
and promoting good feeling and mutual apprecia- 
tion of each other’s problems on the part of both the 
management and the employees. 


THE ETHICS OF SELLING 


HARRY R. TOSDAL 


Mr. Tosdal is Professor of Marketing in the Harvard Uni- 
versity Graduate School of Business Administration. His busi- 
ness experience began some time before finishing college and 
he has had constant contact with business men in a wide variety 
of fields. He is a member of the executive committee of the 
Commercial Standards Council, which is engaged in the endeavor 
to correlate the activities of various business groups directed 
toward higher ethical planes. 

He is the author of Problems in Sales Management, Problems 
in Export Sales Management, The New England Exporter, Prin- 
ciples of Personal Selling, and is a constant contributor to various 
technical journals. 


THE ETHICS OF SELLING? 
Harry R. Tospau 


It is probable that selling activities furnish more 
possibilities and more temptations for unethical 
practice than any other department of a business 
enterprise. It is in the activities of the selling depart- 
ment that the concern comes in contact with com- 
petitors and the consuming public. In order to make 
profits and avoid losses, each business enterprise en- 
deavors to make profitable sales to buyers who are 
attempting to buy at as low a price as possible. As 
a consequence of the apparent conflict of interest, any 
one engaged in selling will find himself occasionally 
and sometimes very frequently confronted with 
ethical problems which are not easy of solution. The 
pressure of competition, particularly the competition 
of unscrupulous competitors or of powerful com- 
petitors, is such as to create a great temptation for a 
particular seller to stretch his opinions to cover the 
exigencies of the moment. He is urged to allow ex- 
pediency to govern instead of moral principle; he is 
tempted to depart from high ethical standards. 

While in the business field it is considerably clearer 


1The author has paraphrased sections and quoted freely from 
his work entitled Principles of Personal Selling (A. W. Shaw, 
1925). 
225 


226 Business and the Church 


to-day than formerly what constitutes ethical or fair 
practices and unethical or unfair practices, there are 
no definite rules which will simplify the solution 
of all problems of ethics which sales executives and 
salesmen must face. There are some sales practices 
which are clearly unethical; there are some sales 
practices which are as clearly ethical; but there is a 
broad middle ground between the two. There are 
some practices not clearly unethical to-day which in 
the long run may be condemned by both public and 
the business group. The decisions of the court and 
statutes on the law-books are constantly limiting this 
field of doubt, but much still remains to be done, 
particularly with reference to selling practices which 
only in a general way affect the individual purchaser. 

From the point of view of the man engaged in 
business, whether he be salesman, sales manager, or 
a member of another department of the business en- 
terprise, it is highly desirable that his occupation be 
considered ethically sound and commendable, and 
that in the pursuit of his occupation he be not con- 
strained to carry on practices which would be con- 
demned by the standards of other occupations or pro- 
fessions. 

Selling has been defined as the art exercised by the 
seller of effecting economic exchanges, or, in other 
words, of bringing about directly or indirectly mu- 
tually beneficial transfers of goods or services. The 
transfers of goods, services, or claims which are to 
be brought about by the seller are economic exchanges 


ee 


The Ethics of Selling 227 


by which each party to the transaction expects to be 
benefited. Since both buyer and seller are free to 
buy or sell as they please, a transaction should not 
and would not take place unless both buyer and seller 
felt that they were benefiting more by what they 
were receiving by the process of the exchange than 
by refraining from entering into the transaction. Eco- 
nomic theory is based on the assumption that ex- 
change will not take place unless both parties feel 
that they have secured a gain in satisfactions or utilj- 
ties. The nature and amount of satisfaction secured 
from an economic exchange form the basis for the 
distinction between good and bad types of selling. 
Selling is a part of the marketing process which has 
for its purpose the increase of economic utilities, par- 
ticularly those which may be classified as time and 
place utilities, in contrast to those produced in the 
manufacturing process, usually called form utilities. 
Selling aims to furnish to the buyer the kind of goods 
he wants, when and where he wants them; manu- 
facture changes the form of the material to make jt 
more suitable for the satisfaction of wants. 

If greater material comfort and well-being are 
desirable, then selling can be said to be desirable be- 
cause it contributes toward it. The maintenance of 
profitable large-scale production in most industries is 
dependent on selling effort. Without such mass pro- 
duction, costs would be increased and the material 
welfare of the country would be decreased. Greater 
effectiveness of labor was brought about by factory 


228 Business and the Church 


production. Socially, one may raise a question as to 
factory production with the monotony of machine 
work which its processes involve, but the evidence 
indicates that the worker derives to-day more mate- 
rial satisfactions than before the advent of the factory 
system. 

The need for such selling will not disappear with 
the increase in the learning and education of the 
people generally, nor with the higher level of intelli- 
gence of the buyers. Buyers will never be so com- 
pletely educated that they will know all about the 
things they need and want to buy. It would be 
socially and economically wasteful for them to ac- 
quire the knowledge necessary. As long as the com- 
petitive system and a complex economic organization 
are accepted as necessary for the welfare of modern 
society, it seems that selling will continue to be 
necessary. 

It must be freely admitted that selling in the past 
has not been conducted in many quarters on as high 
an ethical plane as is desirable. The art of selling 
has often not been practised in such a way as to yield 
the greatest welfare for the salesman, the employer, 
and the public. Theory and practice have on occasion 
been widely divergent, but this divergence has been 
apparent rather than real. The reasons advanced for 
departure from ethical standards are: 


(1) The force of competition. It has been asserted 
that competitors indulged in shady or unfair 


The Ethics of Selling 229 


practices and that it was necessary to follow 
their lead. 

(2) Ignorance of what constitutes ethical selling is 
responsible in many cases for what seems to be 
shady, if not unfair, practice. 

(3) Attitude of employers, in requiring results, in 
urging high-pressure selling, and in feeling no 
responsibility with regard to the method by 
which results were obtained. 

(4) Practice of salesmen. Individual employees 
without ethical principles have on their own 
initiative used illegitimate methods in order to 
get volume of business, methods which may 
or may not have been implicitly authorized by 
the employer. 


The existence of unethical practices is undoubted, 
but the extent of such practices is frequently exag- 
gerated. We have no means of measuring the rela- 
tive morality of selling practices to-day as compared 
with that of a generation ago. But there is a gen- 
eral opinion among business men—and that opinion 
seems to be well founded—that there has been on 
the whole a very distinct advance in the ethical stan- 
dards of personal selling during the past half-cen- 
tury. This advance is partly due to the discovery 
that unethical sales practices were harmful not only 
to the buyer, but ultimately also to the seller, and 
partly due to the increasing diversion of a higher type 
of man into business and the desire to make business 


230 Business and the Church 


a profession worthy of the best efforts of able men. 
Associations of manufacturers and of merchants have 
made attempts, from time to time, to reduce ‘the 
amount of unethical practice by the establishment of 
codes and by more radical measures designed to raise 
the standards. Individually these attempts have not 
usually been important; they are significant mainly 
because they indicate a growing consciousness of the 
need and of the possibilities of high ethical stand- 
ards. 

The ethical basis and economic basis of personal 
selling are identical, if we adopt the utilitarian thesis. 
Accordingly those sales practices are unethical which 
directly or indirectly tend to bring about exchanges 
of goods, money, and service in which one party to 
the exchange receives decreased utility instead of 
added utility; in other words, those exchanges in 
which both parties have not mutually benefited. Fur- 
thermore, exchanges, which may be satisfactory in a 
measure, definitely may be unethical because the re- 
sult is to reduce the amount of utilities received by 
the public below what they may reasonably expect. 

It should be recognized, however, that enlightened 
selfishness is not a complete and sufficient rule of 
business conduct, though its more general application 
would raise the level of present business practice. 

As it is economically to the interest of the sales- 
man to sell in such a way as to leave a satisfied cus- 
tomer, it is just as important from an ethical point of 
view. No man relishes the idea of being engaged 


The Ethics of Selling 231 


in a business which is not of service to mankind. For 
many generations the rule of caveat emptor has pre- 
vailed in selling; that is, in the absence of fraud the 
buyer must beware. To-day more and more business 
concerns are coming to the conclusion that caveat 
emptor is a bad rule for laying the foundation of a 
successful and permanent business. They find that if 
the buyer has constantly to beware, it is very likely 
that he will transfer his business elsewhere. This 
feeling on the part of the buyer is actually increasing 
the difficulty and costs of doing business. Modern 
selling does not permit transactions in which the 
buyer must beware, because the seller knows he will 
eventually suffer if the buyer is not treated properly. 

In general, the application of the principle that 
every sale must bring satisfaction, that every sales 
transaction must create utility for the buyer, must 
for present purposes be considered satisfactory as a 
rule of conduct. But there are many situations in 
commerce and in industry in which the apparent 
pressure to dispose of goods in order to continue 
large-scale operations is a great inducement to the 
sales department and to the salesmen to succumb to 
the temptation to take a short-run point of view and 
to get sales by whatever methods may seem effective 
at the moment. The pressure is increased by the un- 
fair practices of some sellers, and by the collusion 
of those who influence buying. 

Unethical selling practices existed long before the 
Industrial Revolution. The increase in unethical 


232 Business and the Church 


selling which some assert characterizes recent selling 
practices, in comparison to the pre-factory period, is 
apparent, not real; such assertions are based upon lack 
of knowledge of earlier business practices, and upon 
failure to recognize the fact that the number of busi- 
ness transactions is much larger than before. The 
great bulk of selling is carried on fairly and in an 
ethically proper manner; a larger and larger major- 
ity of business men are coming to see that the most 
effective and the most profitable way to do business 
is to follow ethical practices. 

From time to time unethical and unfair practices 
come before the courts. They have been adjudicated 
under general statutes and under the common law 
relating to fraud, conspiracy, restraint of trade, and 
the like. In various States special laws have been 
passed relating to unfair competitive practices. Like- 
wise in the Sherman Act of 1890, and more spe- 
cifically in the Clayton Act of 1914, unfair competi- 
tion and unfair competitive practices are prohibited. 
However, no definition of unfair practices was given 
in the law, which left that to the administrative body 
(the Federal Trade Commission) and to the courts. 

The Federal Trade Commission has handled many 
complaints and has given many rulings regarding un- 
fair trade practices. Some of the practices are bad 
according to any standard which might be established. 
There are others which have been considered fair 
among business men, but which in the long run do 
not operate in the interest of the public. 


The Ethics of Selling 233 


Many classifications have been made of sales prac- 
tices which were doubtful from an ethical point of 
view or clearly unethical, but there has been a great 
deal of disagreement and a great deal of doubt in 
the minds of business men and the public on the 
whole matter. In the effort to remove some of this 
doubt and ignorance the Federal Trade Commission 
in its annual report of 1925 included an extensive 
list of unfair practices brought before the commis- 
sion and declared to be prohibited. 


‘ip 


Inducing employees of competitors to violate their 
contracts or enticing away employees of competitors 
in such number or under such circumstances as to 
hamper or embarrass them in business; 

Trade boycotts or combinations of traders to pre- 
vent certain wholesale or retail dealers, or certain 
classes of such dealers, from procuring goods, or 
goods at the same terms accorded to the boycotters 
or conspirators, or to coerce the trade policy of their 
competitors or of manufacturers from whom they 
buy; 

Unauthorized appropriation of the results of a com- 
petitor’s ingenuity, labor, and expense, thereby 
avoiding costs otherwise necessarily involved in 
production; 

Preventing competitors from procuring advertising 
Space in newspapers or periodicals by misrepresent- 
ing their standing or other misrepresentation calcu- 
lated to prejudice advertising mediums against 
them; 

Harassing competitors by requests not in good faith, 


234 


10. 


Business and the Church 


for estimates on bills of goods, for catalogs, and so 
forth; 

Bidding on the prices of raw materials to a point 
where the business is unprofitable, for the purpose 
of driving out financially weaker competitors; 

The use by monopolistic concerns of concealing 
subsidiaries for carrying on their business, such con- 
cerns being held out as not connected with the con- 
trolling company; 

Intentional appropriation or converting to one’s own 
use of raw materials of competitors by diverting 
shipments; 

Combinations of competitors to enhance prices, 
maintain prices, bring about substantial uniformity 
in prices, or to divide territory or business, or to put 
a competitor out of business; 

Acquiring stock of another corporation or corpora- 
tions where the effect may be to lessen competition 
substantially, restrain commerce, or tend to create a 
monopoly. 


There were others which indirectly affect the 
work of salesmen, but which affect directly the sell- 
ing activities of the concern as a whole: 


lL 


Z. 


3} 


Misbranding of fabrics and other commodities re- 
specting the materials or ingredients of which they 
are composed, their quality, origin, or source; 
Adulteration of commodities, misrepresenting them 
as pure or selling them under such names and cir- 
cumstances that the purchaser would be misled into 
believing them to be pure; 

The use of false or misleading advertisements; 


10. 


1; 


12. 


The Ethics of Selling SS 


Making vague and indefinite threats of patent-in- 
fringement suits against the trade generally, the 
threats being couched in such general language as 
not to convey a clear idea of the right alleged to be 
infringed, but nevertheless causing uneasiness and 
fear in the trade; 

Wide-spread threats to the trade of suits for patent 
infringement arising from the sale of alleged in- 
infringing products of competitors, such threats not 
being made in good faith but for the purpose of 
intimidating the trade; 

False claims to patent, trade-mark, or other rights, 
or misrepresenting the scope thereof; 

Sales of goods at cost, coupled with statement mis- 
leading the public into the belief that they are sold 
at a profit; 

Giving and offering to give premiums of unequal 
value, the particular premiums received to be de- 
termined by lot or chance, thus, in effect, setting up 
a lottery; 

Any and all schemes for compelling wholesalers 
and retailers to maintain resale prices on products 
fixed by the manufacturer; 

Imitating standard containers, customarily associ- 
ated in the mind of the general purchasing public 
with standard weights of the product therein con- 
tained, and to sell to the public such commodity in 
weights less than the aforementioned standard 
units; 

Concealing business identity in connection with the 
marketing of one’s product; 

Tying or exclusive contracts, leases or dealings, in 


236 


ioe 


14. 


15. 


Business and the Church 


which, in consideration of the granting of certain 
rebates or refunds to the customer, or the right to 
use certain patented equipment, and so on, the cus- 
tomer binds himself to deal only in the products of 
the seller or lessor; 
Use, by business concerns associated as trade organi- 
zations or otherwise, of methods which result in 
the observance of uniform prices for the products 
dealt in by them, with consequent restraint or elim- 
ination of competition; such as the use of various 
kinds of so-called standard cost systems, price lists, 
or guides, and so on; 

Interfering with established methods of securing 

supplies in different businesses in order to hamper 

or obstruct competitors in securing their supplies; 

Giving products misleading names so as to give 

them a value to the purchasing public, or to a part 

thereof, which they would not otherwise possess, 
such as: 

(a) Names implying falsely that the particular 
products so named were made for the govern- 
ment or in accordance with its specifications, 
and of corresponding quality, or are connected 
with it in some way, or in some way have been 
passed upon, inspected, underwritten, or en- 
dorsed by it; 

(4) That they are composed in whole or in part of 
ingredients or materials, respectively contained 
only to a limited extent or not at all; 

(c) That they were made in, or came from, some 
locality famous for the quality of such prod- 
ucts; 


The Ethics of Selling 237 


(d) That they were made by some well and favor- 
ably known process, when as a matter of fact 
they were only made in imitation of, and by a 
substitute for, such process; 

(e) That they have been inspected, passed, or ap- 
proved after meeting the tests of some official 
organization charged with the duty of making 
such tests expertly and disinterestedly or giving 
such approval; 

(f) That they were made under conditions or cir- 
cumstances considered of importance by a sub- 
stantial fraction of the general purchasing 
public, and so on. 


The last group of practices were those relating par- 
ticularly to practices which were of importance in 
directing the work of salesmen: 


Ee 


Bribery of buyers or other employees of customers 
and prospective customers to secure new customers 
or induce continuation of patronage; 

Making unduly large contributions of money to 
associations of customers; 

Procuring the business or trade secrets of competi- 
tors by espionage, by bribing their employees, or by 
similar means; 

Procuring breach of competitors’ contracts for the 
sale of products, by misrepresentation or other 
means; 

Making false or disparaging statements respecting 
competitors’ products, their business, financial credit; 
Tampering with and misadjusting the machines 


238 


Liks 


Business and the Church 


sold by competitors for the purpose of discrediting 
them with purchasers; 

Passing off products, facilities, or business of one 
manufacturer or dealer for those of another by 
imitation of products, dress of goods, or by simula- 
tion or appropriation of advertising or of corporate 
or trade names, or of places of business, and passing 
off by a manufacturer of an inferior product for a 
superior product theretofore made, advertised, and 
sold by him; 

Misrepresentation in the sale of stock of corpora- 
tions; 

Selling rebuilt machines of various descriptions, re- 
built automobile tires, and old motion-picture films 
slightly changed and renamed as and for new 
products; 

Giving away of goods in large quantities to hamper 
and embarrass small competitors, and selling goods 
at cost to accomplish the same purpose; 

Various schemes to create the impression in the 
mind of the prospective customer that he is being 
offered an opportunity to make a purchase under 
unusually favorable conditions, when such is not the 
case, such as: 


(a) Sales plans in which the seller’s usual price is 
falsely represented as a special reduced price 
made available on some pretext, for a limited 
time or to a limited class only; 

(4) The use of the “free” goods or service device 
to create the false impression that something 
is actually being thrown in without charge 
when as a matter of fact the cost is fully cov- 


: 


The Ethics of Selling 239 


ered by the amount exacted in the transaction 
taken as a whole; 


(c) Sales of goods in combination lots only with 


(2) 


abnormally low figures assigned to staples, the 
prices of which are well known, and corre- 
spondingly high compensating prices assigned 
to staples the cost of which is not well known; 
Sale of ordinary commercial merchandise at 
usual prices and profits, as pretended govern- 
ment war surplus offered at a bargain; 


(e) Use of misleading trade names calculated to 


(f) 


(zg) 


(4) 


create the impression that a dealer is a manu- 
facturer, selling directly to the consumer, with 
corresponding savings; 

Plans ostensibly based on chance, or services to 
be rendered by the prospective customer, 
whereby he may be able to secure goods con- 
tracted for at particularly low prices, or with- 
out completing all the payments undertaken 
by him, when as a matter of fact such plans 
are not carried out as represented and are a 
mere lure to secure his business; 

Use of pretended, exaggerated retail prices in 
connection with, or upon the containers of, 
commodities intended to be sold as bargains at 
lower figures; 

Falsely claiming forced sale of stock, with re- 
sulting forced price concessions, when as a 
matter of fact there is mingled with the cus- 
tomary stock inferior goods, and other meth- 
ods are employed so that as a matter of fact 
no such concessions are in fact accorded; 


240 
12. 


13: 


14. 


ix 


16. 


Business and the Church 


Seeking to cut off and hamper competitors in mar- 
keting their products through destroying or remov- 
ing their sales display and advertising materials; 
Subsidizing public officials, or employees, through 
employing them or their relatives, under such cir- 
cumstances as to enlist their interests, in situations 
in which they will be called upon, by virtue of their 
official positions, to act officially ; 

Misrepresenting in various ways the advantages to 
the prospective customer of dealing with the seller; 
such as: 


(a) Seller’s alleged advantages of location or size; 

(6) False claims of being the authorized distributor 
of some concern; 

(c) Alleged endorsement of the concern or prod- 
uct by the Government or by nationally known 
businesses; 

(d) False claim by a dealer in domestic products of 
being an importer, or by a dealer of being a 
manufacturer, or by a manufacturer of some 
product of being also the manufacturer of the 
raw material entering into said product; 

(e) False claim of “no extra charge for credit”; 

(f) Of being manufacturers’ representative and 
outlet for surplus stock sold at a sacrifice, and 
so forth; 


Showing and selling prospective customers articles 
not conforming to those advertised, in response to 
inquiries, without so stating; 

Direct misrepresentation of the composition, nature, 
or qualities of the product offered and sold; 


oe ee ee eee ee 


The Ethics of Selling 241 


17. Securing business through undertakings not carried 
out and through dishonest and oppressive devices 
calculated to entrap and coerce the customer or 
prospective customer, such as: 

(a) Securing prospective customer’s signature by 
deceit to a contract and promissory note repre= 
sented as simply an order on approval; securing 
agents to distribute the seller’s products through 
promising to refund the money paid by them 
should the product prove unsatisfactory, and 
through other undertakings not carried out; 

(4) Securing business by advertising a “free trial” 
offer proposition when as a matter of fact only 
a “money back” opportunity is offered the 
prospective customer, and so forth. 


While these lists are not complete, they furnish 
evidence that in comparison with practices approved 
and tolerated in the latter part of the nineteenth cen- 
tury, there has been a very distinct improvement in 
the standards of selling practice. Some of the unfair 
practices have already been declared contrary to pub- 
lic interest. 

Business in many respects is beginning to assume 
the characteristics of a profession, both as to ethical 
basis and as to the training required for the practice 
of many of its branches.” The solidarity which char- 
acterizes the majority of professions is coming more 
and more into evidence in business as well, and there 
are many trade associations which are actively inter- 


7A. Lawrence Lowell, The Profession of Business, Harvard 
Business Review, Vol. I, p. 129. 


242 Business and the Church 


ested in the formulation of codes of ethics or stand- 
ards of practice. The reason for this rapidly growing 
desire to formulate standards of practice seems to be, 
in the first place, the development of a keener moral 
sense on the part of business as a whole. 

There is developing greater public pressure for 
higher standards of conduct in business. The situa- 
tion at any particular time is one in which there are 
many firms whose ethical standards are considerably 
higher than those demanded by the public, many 
more firms whose standards are no higher than pub- 
lic opinion sanctions, and many firms whose stand- 
ards are lower than the general level of practices 
permitted by the public as interpreted by the courts 
and administrative bodies. Lastly, there is the de- 
velopment of a desire of the able men in business to 
feel the same pride in their accomplishments and in 
their work as does a member of any other profession. 

Many of the codes of ethics which have been for- 
mulated cannot be said to represent codes of ethics in 
the strict sense of the term. Some elements which 
do not involve ethical principles but merely the pref- 
erences of the members of a trade as to sales policies 
are permitted to creep into the standard of practice 
or the code. The attempt is made to give them the 
force of ethical sanction, when the provisions merely 
approve some of many possible practices all of which 
may be equally ethical, from the point of view of 
their influence upon public welfare and upon the 
persons concerned. 


a 


The Ethics of Selling 243 


A study of the codes of ethics issued by various 
groups of business men reveals many points in com- 
mon. Not a few of them emphasize the point that 
the seller must conduct himself in his relations to 
customers as he would like to be treated if he were 
a buyer instead of a seller. Some of the codes of 
ethics go into a great deal of detail regarding the 
practices which are to be considered unethical in mak- 
ing sales. Some of them contain little more than 
broad statements of general principles. Among the 
most common are those referring to misrepresenta- 
tion of goods, dealings with competitors, and com- 
mercial bribery. But one can find examples of code 
provisions relating to every practice which has come 
before the Federal Trade Commission and a num- 
ber of others. 

Certain provisions are of special interest. These 
are: 


(1) The provision relating to misrepresentation of 
goods sold or to misrepresentation of the seller. 
For instance, the American Face Brick Associa- 
tion includes in its code of ethics the statement, 
“Avoid scrupulously overstatements or misrep- 
resentation of any kind in your own behalf 
either in advertising or in personal selling.’ 


*E. L. Heermance has compiled in Codes of Ethics: A Handbook, 
over a hundred of these codes. 

See also J. George Frederick, Book of Business Standards, New 
York, 1925. 

“Among the other codes containing general provisions are the 
National Basket and Fruit Packers’ Association; the International 
Association of Garment Manufacturers; the National Commercial 


244 


Business and the Church 


(2) A number of codes of ethics contain provisions 


that “sellers shall take advantage of no man’s 
ignorance, shall see that employees are truthful 
and straightforward, and that keen and confid- 
ing buyers shall be treated alike.” 


(3) The provision against disparaging competitors 


(4) 


or their products or prices is very common. One 
provision states that “as knocking is a practice 
unworthy of business, no salesman should speak 
disparagingly of another salesman or competing 
firm.”® 

More specific is the provision of the National 
Association of Oxy-chloride Cement Manufac- 
turers, against “the making or circulating of 
false or misleading statements, either written or 
oral, against the competitor’s product, service, or 
selling price, or regarding his business, financial, 
or personal standing.” 
It is generally considered unethical for a sales- 
man to attempt to tamper with an order which 
has already been placed with another member 
or another manufacturer who is not a member ; 
in other words, “to refrain from all further so- 


Fixtures Association; the National Wholesale Men’s Furnishings; 
the National Paint, Oil, and Varnish Association; and the Paint 
Manufacturers’ Association of the United States. 

‘International Association of Garment Manufacturers has a 
similar provision in its code. 

° National Commercial Fixtures Association code of ethics, Art. 9. 

"Other codes contain a similar provision, such as of the Iowa 
Concrete Association, the National Confectioners’ Association of the 
United States, and the National Association of Farm Equipment 
Manufacturers. 


The Ethics of Selling 245 


licitation after a competitor has secured an adop- 
tion or an order, to be considered such when for- 
mally expressed in writing.” 

(5) Commercial bribery is universally condemned. 
The code of ethics of the Gas Products Associa- 
tion is as follows: “We shall not resort to 
bribery or other means of persuading customers 
to acts which discredit a competitor’s product.” 
The National Association of Hat Manufactur- 
ers declares, concerning its relations with cus- 
tomers, that it will not give commissions, money, 
or other things of value to the employees of 
customers for the purpose of influencing their 
buying.® 


It is unnecessary to go into detail to show the 
type of practices which are considered unethical. 
An examination of the long list of codes which have 
been published gives one an impression that selling 
as practised is striving toward a higher standard. In 
many cases it must be recognized that codes of ethics 
of business associations have been established and are 
practised only by the leading, most progressive mem- 
bers of a trade. Nevertheless, a great deal of sig- 
nificance should be attached to these codes, not be- 
cause they are followed in actual practice to-day, 


®The Plywood Manufacturers Association, the National Whole- 
sale Men’s Furnishings Association, the Associated Metal Laths 
Manufacturers, the Western Association of Nurserymen, the Na- 
tional Paint, Oil, and Varnish Association, are among the many 
which have such provisions in their codes. 


246 Business and the Church 


but because they indicate how business men regard 
the future of business. Business will gradually rise 
to the levels set by these codes. 

It is evident that the codes now available do not 
completely satisfy our needs. Revision, as our stand- 
ards grow higher and as our practices and policies 
become better defined, will be inevitable. The more 
general realization of business men that high ethical 
standards are necessary will develop more satisfac- 
tory working rules. At the present time the most sat- 
isfactory ethical rules are those which are derived 
from the definition of salesmanship given at the out- 
set. The ethical basis of salesmanship is embodied 
in the idea that salesmanship must be mutually bene- 
ficial, an idea embodied positively in Christian moral- 
ity and negatively in Confucianism, and found in one 
form or another in virtually all the great religions 
of the world, if one also bears in mind that, while 
expediency may rule in the choice between ethical 
policies, expediency cannot rule in the choice between 
ethical and unethical policies. Confidence must be 
built up as a basis for reducing the cost of distribu- 
tion just as it must be present in every sale. Ethical 
practice develops such confidence; unethical practice 
destroys it. 

While business is far from attaining the moral 
standards it should and will attain, one can point 
to definite progress in the development both of stand- 
ards and of moral accomplishment. The history of 
commerce and industry reveals a slow but definite 


The Ethics of Selling | 247 


rise in the regard of men for commercial pursuits, 
by reason of the increasingly keen realization of the 
importance of economic effort. Coincidentally with 
this, the standards of business men have risen. When 
a sale was regarded as a transaction in which one party 
must be the loser, obviously ethical standards in sell- 
ing could not gain much headway. In the ancient 
Greek era, commerce was considered unworthy of a 
freeman. Commerce and selling were carried on by 
slaves, while citizens were left to run the state. In 
Roman times, wholesale business emerged as an oc- 
cupation in which the elect might engage, but it was 
long before retail selling was considered an honor- 
able occupation. The Dark Ages showed little prog- 
ress, and the development of scholasticism in the 
latter half of the Middle Ages placed the idea of fair 
price as a basis of commercial ethics. The schoolmen 
made a great contribution in improving the status of 
labor, pointing out that all forms of labor were hon- 
orable; but there seemed to be a tendency to except 
the merchant from such universal approval, because 
there was still the feeling that in a sales transaction 
one party must be the loser. It was not until the 
eighteenth century that the idea penetrated the minds 
of thinkers that economic transactions must give bene- 
fit to both parties, that the transaction could not take 
place unless each felt that he would get more satis- 
faction from making the transaction than from re- 
fraining from it. No more progress was possible in 
selling while the old idea prevailed. 


248 Business and the Church 


It is true that during the nineteenth century and 
previously, a new situation had arisen. The selling 
problem was immensely increased in difficulty and 
scope because of the Industrial Revolution and the 
mass production which was its consequence. Sell- 
ing problems were shifted. Problems of physical 
supply seemed to be paramount. After the Civil 
War in this country, there was intense competition— 
new types of production, cutthroat competition 
among the railroads, rate wars—and a study of the 
period from 1870 to 1895 reveals little regard on 
the part of business men for ethical niceties. Pub- 
lic recognition of the situation was shown in the inter- 
state commerce laws, and particularly in the flood of 
antitrust laws culminating in the Sherman Antitrust 
Act of 1890. Both by legal decisions under the com- 
mon law and by decisions under these statutes, many 
practices which were common before that time were 
prohibited. The emphasis upon unethical or unfair 
competition, which resulted in the passage of the 
Sherman Act, was directed against the trusts because 
the unethical practices of some of them were much 
more conspicuous than the unethical practices of 
smaller units. It is even conceivable that the prac- 
tices of the trusts were on the whole higher than the 
practices of most individual business men; but ob- 
viously the social consequences of unfair practices, 
when carried on by huge aggregations of capital, are 
quite different from those carried on by small units. 
The practices which were forbidden by the Sherman 


The Ethics of Selling 249 


Antitrust Act and by the decisions beginning with the 
nineties are now for the most part the exception 
rather than the rule. Whether or not those practices 
would have disappeared without such legislation is a 
matter of conjecture, but it is almost a truism that 
statute law progresses in the interpretation of most 
questions more slowly than does public opinion. It 
might well be that these practices, because they meet 
public condemnation, would have become unprofit- 
able and would have disappeared without any legis- 
lation. 

In the future we may expect that ethical standards 
will be enforced by business enterprises and by sellers 
themselves, that the growing sense of social respon- 
sibility of business men will be added to an enlight- 
ened selfishness to make those standards more con- 
sistent with the aims of the church than they are at 
present. 


BUSINESS AS A FACTOR IN PROGRESS 


EDWARD A. FILENE 
MercuHANT 


Mr. Filene, president of William Filene’s Sons Company, of 
Boston, is generally recognized as one of the outstanding busi- 
ness leaders of the country, and his contributions to public 
service both at home and abroad have gained for him an inter- 
national reputation. Under his presidency and chairmanship 
the yearly volume of the business of his firm has grown to an 
excess of twenty-five million dollars. 

Mr. Filene was a pioneer in recognizing that the function 
of retail distribution should be undertaken as a public service. 
He has always dealt with matters of general welfare and co- 
operation in business not on the basis of philanthropy or pater- 
nalism, but as essential factors to the development of successful 
business, 

Some of Mr. Filene’s public activities are: 


A prominent part in the organization of the Public 
Franchise League of Boston. 

The organization of the Boston City Club, a social experi- 
ment in bringing together all types, classes, and races. 

The reorganization of the Boston Chamber of Com- 
merce. Mr. Filene led the successful fight for the Work- 
men’s Compensation Law of Massachusetts. 

A member of the board of directors and of the executive 
committee of the International Chamber of Commerce. 

In 1908 Mr. Filene introduced into the United States 
the Raiffaisen banking system of Germany under the name 
of credit-unions. Legislation permitting the organization 
of credit-unions in twenty-four States has been secured. 


Among other public activities, Mr, Filene rendered important 
services to the Government during the war. He was chairman of 
the War Shipping Committee of the Chamber of Commerce of 
the United States and a member of its committee for financing 
the war, one of the founders of the League to Enforce Peace, 
vice-chairman of its executive committee, and chairman of its 
finance committee, 


BUSINESS AS A FACTOR IN PROGRESS? 


Epwarp A. FILENE 


In the final analysis, beauty is the greatest objec- 
tive of the world. But we cannot teach spiritual 
truths effectively to starving people. One great way 
to make more beauty in this world is to make the ob- 
taining of a living—the obtaining of the necessary 
food, clothing, and shelter, and the necessary mini- 
mum of luxuries—so mechanical and so little time- 
consuming that we all shall have time for avocations, 
have time to work for and search for better things, 
to search for beauty. This can be accomplished by 
saving of waste, by more economic justice, by inven- 
tion and better organization of production and dis- 
tribution, by better training of workers and leaders. 

I believe that the modern business system, despised 
and derided by innumerable reformers, will be both 
the inspiration and the instrument of the social prog- 
ress of the future. Such a statement cannot go far 
without encountering vigorous dispute. The air is 
filled with voices asserting that the modern business 
system stands squarely across the path that leads to 


1 This section is based largely on material from Mr. Filene’s book, 
The Way Out, and is therefore published through the courtesy of 
Doubleday, Page & Company. 


253 


254 Business and the Church 


a decent social order. On every hand there are men 
who contend that we can assure social progress only 
by destroying the business system and reorganizing 
our life upon a communistic or near-communistic 
basis. And multiplied thousands of men and women 
who are far from being communists indict the modern 
business system as the tyrant rather than the tool of 
mankind. 

Now, I am under no delusion about the social effi- 
ciency of our industrial civilization. Despite the fact 
that science is daily making life more livable and in- 
teresting, daily devising ways and means for shifting 
burdens from the backs of men to the backs of ma- 
chines, daily widening the range of men’s interests by 
rapid transportation and communication, and broad- 
ening the scope of existence generally, the time of 
the majority of mankind is still occupied almost en- 
tirely in the business of providing food, clothing, and 
shelter, with little time or training for lifting life to 
a higher level—even if the means were at hand. This 
is plainly indefensible, if it is to be accepted as the 
inevitable result of the business system. A system 
that does this cannot escape indictment and assault. 
For the average man will not long be content to 
exhaust himself in the task of merely providing food, 
clothing, and shelter for himself, his wife, and his 
children, with virtually no energy left for other 
things. 

I know all this. And yet I am convinced that the 
social progress of the future will be achieved not by 


a - 


Business as a Factor in Progress 255 


the destruction of the business system, but by its fur- 
ther and finer development. The modern business 
system is at present more or less lawless, but the 
pressure of necessity during the next ten or twenty 
years will enforce its reform. Unless I wholly mis- 
interpret the signs of the time, we are now in the 
morning hours of a period in which business men, in 
order to survive and succeed, will be compelled to 
adopt the sort of policies that will give us an in- 
creasingly better social order. During the next ten 
or twenty years we shall come to see from practical 
experience that there is nothing necessarily contra- 
dictory between successful business and_ social 
progress. Success in both will demand the same 
principles and the same practices. Commercial suc- 
cess and social welfare, in the days ahead, will stem 
from the same root. 

The average man and the average student of 
social conditions too often start with the premise 
that business by its very nature is antisocial. Certainly 
conspicuous business success has been so regarded. 
And we are obliged to admit that much of it in the 
past has been. But the point I want to make is that 
business must henceforth function in a changed world 
—a world in which good business policies will be 
found to be good social policies. 

What I mean concretely is this: social progress 
demands codperation, the modification or—to bor- 
row a word from the psychoanalyst—the sublima- 
tion of the class struggle, the access of every man, 


oS 
wd 
Ocicay sew 


256 Business and the Church 


woman, and child to a decently adequate supply of 
the necessities of life, and the release of the individ- 
ual from the things that prevent his living a creative 
and contented life. In the past, successful business 
has often blocked the way to a realization of these 
socially necessary ends. But coming conditions are 
going to compel businesss men to make changes in 
policy and in action that will result in just these 
things. The business policies that will enable men 
to make the big business successes of the next ten or 
twenty years will produce these things as by-products. 

For some years to come, in the absence of develop- 
ments not now predictable, American business will be 
unable to export the surplus goods it will be able to 
produce, the surplus goods it is even now geared up 
to produce. A ramshackle Europe in reduced cir- 
cumstances will not be a good customer. 

Unable to spend their surplus energy in competing 
for foreign business, American business men will de- 
vote their surplus energy to a keener competition 
for domestic business. 

In the super-competition that will result, the small 
business man and the inefficient business man will 
have a very difficult time matching the prices and the 
service of the big factories and the big stores that do 
business on the basis of mass production and mass 
distribution. 

Everything will tend to drive American business 
and industry into mass production and mass distribu- 
tion. 


Business as a Factor in Progress 257 


This mass principle, widely applied, will result in 
hitherto undreamed-of economies and efficiencies. 

These economies and efficiencies will make possi- 
ble a marked reduction in Prices, will in fact compel 
a marked reduction in prices, for the main idea of 
mass production and mass distribution in the matter 
of profits is that the largest total profit is to be made 
from the sale of an enormous number of articles at 
a small profit per article. 

This reduction of prices will relieve the economic 
strain on the masses, mitigate the fears of insecurity 
and unpreparedness against the exigencies of life and 
labor that to-day haunt the minds of workmen, make 
possible a generally higher standard of living, and in 
every way reduce that class friction which seriously 
slows down the rate of social advance. 

These things—to say nothing of the ultimately 
higher real wages that mass production will make 
possible by bringing about at the same time a reduc- 
tion in cost of tres aa give greater freedom to 
the individual. 

Thus successful business, under the lash of neces- 
sity, will make for social progress. I am not sug- 
gesting, mark you, that business men are going to ex- 
perience a sudden new birth of social idealism, but 
simply that business men, face to face with difficult 
times, will do the things that can alone assure their 
success, and will later discover that business intelli- 
gence and social idealism have met and merged. 

In times past, business could be successful despite 


258 Business and the Church 


many antisocial policies and practices, because society 
was not in the tight corner it is in to-day. The 
business man of the past was in very much the same 
position as the pioneer who could afford to be reck- 
lessly wasteful in a virgin land. Business, until now, 
has been on what might be called a pioneering spree. 
Only lately have economy and the wisest possible 
handling of men and material become absolute es- 
sentials to business success. 

As H. G. Wells makes a character in one of his 
later novels say: “In the days before the war it was 
different. A little grabbing or cornering was all to 
the good. All tothe good. It prevented things being 
used up too fast. And the world was running by 
habit; the inertia was tremendous. You could take 
all sorts of liberties. But all this is altered. We’re 
living in a different world.” 

We are indeed living in a different world. In 
place of abundance we have shortage in most nations. 
Instead of a simple world with lots of elbow-room, 
we have a world complicated and crowded. In place 
of dominant captains of industry and docile laborers 
we have captains of industry in insecure seats and a 
labor mass become articulate and conscious of its 
political and economic power. In short, we are now 
living in a world in which the reckless and wasteful 
methods of the exploiter are a social menace and 
the creative methods of the scientific, socially minded 
business man a social necessity. The business man of 


Business as a Factor in Progress 259 


yesterday could get along very well with the pioneer 
virtues and pioneer practices. The business man of 
to-morrow must have the engineer mind and be 
guided by a vision of economic statesmanship. 

The pioneer, although a wasteful exploiter, is 
more than worth his bed and board because of the 
new territories he opens up. But unless he keeps 
moving on into newer and newer territories his vir- 
tues soon become obsolete and a heavy charge on 
society. As society develops, the pioneer must al- 
ways be succeeded by the engineer and the statesman. 

In the pioneer conquest of this continent the 
pioneer did not use fertilizer, because it was cheaper 
to move to new acreage when the old soil was de- 
pleted. He did not pick a tree clean of its fruit or its 
nuts; it was simpler to move to the next tree and pick 
from the easily accessible lower branches only. He 
did not conserve the buffalo and other game; the 
game supply seemed inexhaustible. Exploitation was 
actually cheaper than conservation. The paradox 
of pioneering is that, for the individual pioneer, 
waste is economical. 

But when the last frontier was reached the pioneer 
had to change his methods or become a personal 
failure and a social liability. When there were no 
more new lands to preémpt, the old had to be fertil- 
ized. When fruits and nuts were no longer to be 
had just for the picking, orchards had to be planted 
and protected, and every tree had to be carefully 


260 Business and the Church 


picked. When the end of the game supply was in 
sight, game laws had to be drafted for its conserva- 
tion, and cattle herds created and maintained. 

All this holds a lesson that we business men will 
do well to heed before we are compelled by costly 
experience to heed it. American business has reached 
its last frontier. I am referring not to the size of 
American business but to the sort of policies it must 
follow. We are entering a period in which policies 
of exploitation that smack of the antisocial wasteful- 
ness of the pioneer will not be profitable. Only a 
broader and more scientific approach will enable the 
business man of the future to survive, to say nothing 
of succeeding in any large sense. 

I am not slinging mud at the business men of the 
past. I am not indulging in the conventional fault- 
finding with the ruthless business exploitation that 
marked the past years of our national development. 
The “rape of the continent” has been analyzed and 
reanalyzed until there is no need to go over that 
ground again. The old business man may have 
blackjacked the public into excessive concessions as 
a reward for his services in building the nation’s rail- 
roads and establishing its basic industries. From the 
current point of view it is the easiest thing in the 
world to indict him for a sort of economic blackmail 
of the nation, but he was only playing the eternal rdle 
of the ruthless and wasteful pioneer. 

There is always a little injustice, a little lack of 
sympathetic understanding, in the criticism one gen- 


Business as a Factor in Progress 261 


eration passes upon the practices of its predecessor. 
But we must remember that, for good or for ill, we 
are the children of our own generation and none 
other. We shall be judged more by the virtues we 
achieve for ourselves than by the criticisms we launch 
against the sins of our fathers. There is nothing 
to be gained by wasting tears over the business ex- 
ploitation of the past. We would better turn our 
energies to the urgent job of substituting the en- 
gineer mind for the pioneer mind in the American 
business of the future. 

The wise business man, seeing that we have passed 
the time when reckless, wasteful, exploitative, and 
antisocial methods could be made profitable, will, as 
I have suggested, turn to the scientific development 
of business. He will do this not merely because a 
new social conscience constrains him but primarily 
because sound business intelligence and competition 
force him to do it. When the character in Mr. Well’s 
novel said that we were living in a new world, he 
went on to say: “It’s a new public. It ’s—wild. 
It 11 smash up the show if we go too far.” Now, I 
am not suggesting that the business man will or 
should base all his policies on the fear of social 
revolution. I am saying only that the new economic 
and social conditions that have come as a result of the 
increasing industrialism, the increasing complexity, 
and the increasing interdependence of society, that 
the particular economic muddle of transition into 
which the war plunged the world, and especially the 


262 Business and the Church 


newly awakened mind of labor, all mean that the 
business of the future cannot be commercially suc- 
cessful unless it is socially sound. 

All this may sound theoretical and a bit out of 
character, coming from a shopkeeper, but I am con- 
vinced that nothing will so quickly fit a business man 
to survive and to succeed in the difficult years ahead 
as a thorough personal study of the relation between 
successful business and social progress. They are not 
two problems, but two aspects of the same problem. 
Let the business man begin his study with either 
conception—that of successful business or that of 
social progress—and if he thinks straight, he will 
come out'with the other. That is to say, he will find 
that a scientific application of the policies needed for 
social progress will bring business success, and con- 
versely that the scientific application of the policies 
needed for successful business will bring social 
progress. 

But the business man who tries to establish the 
right relation between his business policies and the 
requirements of social welfare runs the risk of fall- 
ing into a dangerous error—the error of thinking, 
even subconsciously, that because he has done some- 
thing.a little more right than is customary, he is less 
likely to succeed and is perhaps a little less obligated 
to succeed. 

This may seem a statement born of unnecessary 
caution, but over and over again I have found that 
when men begin to concern themselves with social 


Business as a Factor in Progress 263 


justice in their businesses they are tempted to usé 
their good intentions as an alibi for business short- 
comings. Social progress does not lie that way. And 
certainly business success does not. We must realize 
that a good ethical sense is no excuse for a bad busi- 
ness sense. 

I have a very solid respect for the much-satirized 
phrase, “Business is business.” I believe it is better 
to run a business honestly in the ordinary fashion 
than to introduce into it forward steps in the direc- 
tion of social welfare, if their introduction carries 
with it even covertly the suggestion of an excuse for 
doing business less well. Sincerity is no justification 
for sloppiness. 

I do not want to seem to be putting the money in- 
terest above the human interest, or to seem to suggest 
that good social policies are valid only when they 
do not interfere with profits. The whole idea of this 
article is that good social policies are the surest 
recipe for big and continuous profits. I am speaking 
only of the man who dabbles in matters of social 
welfare without seeing this. My conscience is easy, 
however, even with the risk of misinterpretation of 
what I have just written, for I know from long ex- 
perience that straight business thinking is always, in 
the end, sound social thinking. 

The point I am trying to make is that there is a 
lot of merely good impulse that is mistaken for that 
sound social thinking which is always straight busi- 
ness thinking. It is against this merely good impulse, 


264 Business and the Church 


devoid either of wide social vision or of sound busi- 
ness sense, that the business man must guard himself, 
for social progress is not helped by the business man 
who carelessly introduces all sorts of progressive so- 
cial policies into his business and then ends in the 
bankruptcy court. Such a business man, despite his 
good intentions, is the worst possible enemy of social 
progress. He gives the cause a bad name among 
other business men who, remembering his bank- 
ruptcy, are likely thereafter to think of his sound 
social policies as the cause of his failure. 

All of which emphasizes the fact that the socially 
minded business man has a greater obligation to suc- 
ceed than any other type of business man. He must 
remember that the first business of reform is to suc- 
ceed. Otherwise the innovation stands no chance of 
being imitated. Social progress suffers when it is 
sponsored by well-meaning but untrained minds. 
The impulse toward justice is bound to be abortive 
unless it recognizes the obligation of success. Shall 
I be guilty of straining for a paradox if I say that, 
from the long view, unsuccessful business morality 
is immoral? 

I have tried to suggest that there are certain spe- 
cial reasons, growing out of the stress and strain of 
the post-war period, that will make the successful 
business of the future a mainstay of social progress. 
In addition to these, there are several abiding reasons, 
inherent in the business system itself, why the cause 
of social advance has more to hope for from the 


Business as a Factor in Progress 265 


business of the future than from the political ad- 
ventures and the general reform movements of the 
future. 

Granted the right leadership, I am sure that busi- 
ness is a better instrument than politics for the 
achievement of an increasingly better social order. 
Let me contrast, for a moment, the business system 
with practical politics. This has been done many 
times, so I am merely summarizing, not setting out 
any new ideas. 

Business operates all the time; political parties 
function at high efficiency only part of the time— 
campaign time particularly. 

Business deals with the concrete things that affect 
intimately and continuously the daily lives of all of 
us; politics deals too much in airy abstractions that 
may be good enough to campaign with but are inade- 
quate to live by. 

Business leadership is determined in most instances 
by the careful process of selection; political leader- 
ship is chosen by the none-too-effective method of 
election. 

Business determines the careers of most of us; 
politics determines chiefly the careers of office- 
holders. 

But the one thing that makes business predomi- 
nantly the instrument for social progress—if we only 
use it wisely—is the fact that business men control 
the progress of this country. They control the 
progress of the country not because they are either 


266 Business and the Church 


geniuses or pirates or because they have joined in 
any dark plot to capture and loot the common people. 
They are neither more grasping nor more public- 
spirited than other men. They control the progress 
of the country simply because this is an industrial 
nation, and their hands happen to be on the levers 
of power. 

Whether they are blundering or brilliant, whether 
they are actuated by sinister motives or by social 
vision, they still control the processes of production, 
distribution, and consumption. And these three pro- 
cesses touch our lives at more points and oftener than 
all the torch-light processions, Congressional debates, 
and reform movements that have taken place since 
the first politician mounted the stump and the first 
reformer challenged the status guo. What business 
men think and do about production, distribution, and 
consumption is therefore the most important single 
factor to be considered in any study of the possible 
arrest or advancement of social progress. It is not 
so much the attitude of business men toward “public 
questions” as it is their attitude toward “business 
questions” that counts in the history of social advance. 

Whatever may be the point of view that will dom- 
inate the business men of the next ten or twenty years, 
the fact remains that the sort of place America is 
going to be to live in will be determined more 
in Pittsburgh and Fall River mills, New York banks, 
Brockton and St. Louis shoe factories, Arizona mines, 
and the other business and industrial centers than in 


Business as a Factor in Progress 267 


Washington and our state capitals. Whether the 
business man visualizes his job as a challenge to 
economic statesmanship or as a mere buccaneering 
adventure, the fact remains that the key to social 
progress lies in his hands. 

The business system, then, is an ideal instrument 
for the achievement of sound social progress, and 
it is gratifying to see that modern conditions will 
more and more tend to make it impossible for the 
business man to succeed in any large way except as 
he uses this instrument wisely, uses it in a way that 
serves the interests of society as well as the interests 
of his stockholders. 

The successful businesses of the future will be the 
businesses that improve the processes and reduce the 
costs of production, rid distribution of its present in- 
defensible wastes, bring the price of the necessities 
of life lower and lower, shorten the hours of labor 
and enlarge the margin of leisure, eliminate periodic 
depressions and recurrent unemployment, limit the 
area of the industrial battle-field and enlarge the 
floor-space of the council-chamber, create better and 
better working conditions, pay higher real wages, 
and increase the comfort and prosperity of both their 
employees and their customers. 

These are the things that the facts prove will be 
not optional but obligatory upon the business man 
who wants to succeed in a big way during the next 
ten or twenty years. And these are the things that 
will give us decent social progress. 


268 Business and the Church 


It is customary for social critics to bewail the fact 
that American civilization is predominantly a busi- 
ness civilization. I hope to live to see the day when 
that regret will be changed to pride, a change that 
waits only upon business sense, business vision, and 
business statesmanship. And the ambition to suc- 
ceed will join with the harsh schooling of the bank- 
ruptcy court in making this sort of business adminis- 
tration more and more common. The social progress 
of the future lies not in the destruction of the 
modern business system, but in its further and finer 
development. 

While I am not a church-goer, and while I see 
the way out for social progress through a finer de- 
velopment of the modern business system—a system 
essentially based on increasing production, that 1s, 
on “Fordizing” the necessities of life and greatly 
cheapening their distribution—I realize that improv- 
ing the methods of production and distribution will 
not be a real way out unless it is permeated with the 
religious point of view. Even sublimated business 
will need the church—will need religion more than 
ever. The further we extend the machinery of busi- 
ness for material progress, the greater will be the 
danger if it is not governed by the spirit and will for 
service—if it is not religiously directed and con- 


trolled. 


AN EXPERIMENT IN INDUSTRIAL 
DEMOCRACY 


DOROTHY NORD-HOLT 


FoREWOMAN 
Tur CotumBiA ConsERVE CoMPANY 


Miss Dorothy Nord-Holt was born in Indianapolis in 1901. 

Her father was born in Germany, very near the Holland 
border. He served in the German army, but came to the 
United States as a young man and worked for a German truck- 
gardener, whose daughter he married. 

Her mother came to this country as a small child. 

Her parents have always been in comfortable circumstances, 
but, following the traditions of the German truck-gardeners 
that much schooling, especially for girls, is unnecessary, she 
began her industrial life after one year of high school. How- 
ever, as she was naturally studious, by serious reading she gave 
herself an education much better than most college graduates 
have; and after a few years at manual work, stimulated by her 
reading and by many Y.W.C.A. conferences, she began to 
question the present industrial order. Her early contentment 
with the paternal attitude of the wholesale drug-house where 
she worked for several years changed to rebellion, until finally 
she associated herself with the Columbia Conserve Company. 
She became forewoman for that company about a year ago. 

She is one of the most fearless and radical members of the 
council, and always is among the vanguard which urges the 
more timid workers to make deeper experiments contrary to 
the traditions of the capitalistic system, 


AN EXPERIMENT IN INDUSTRIAL 
DEMOCRACY 


A. D. N. Hotr 


Many names have been applied to experiments 
such as that being made at the Columbia Conserve 
Company, in Indianapolis, among them, Industrial 
Democracy, Employee Management, and Democratic 
Control. Whatever the title given, there seems to 
be a very real movement in industry toward giving 
the workers themselves some voice in the manage- 
ment of their working-day affairs. 

The Columbia Conserve Company is a canning in- 
dustry capitalized at $400,000, doing approximately 
$1,000,000 worth of business in 1925. It has been 
in operation since 1903 and is at present owned for 
the most part by three brothers; namely, Norman, 
Hutchins, and William P. Hapgood. Because of 
the keen interest of these brothers in the possibilities 
of new and better human relationships in industry, 
and their belief that the management of the business 
should be by those who work in it, and by the largest 
possible number of such workers, they decided to 
turn over the management of the company to them. 

William P. Hapgood, the only member of the 
family who is actively connected with the business, 

271 


PAS hs Business and the Church 


called all the workers together in April, 1917, and 
outlined to them what the owners proposed to do and 
asked them to consider the plan. It was accepted, 
though at first there was a good deal of skepticism 
on the part of the employees. They thought there 
must be a catch in it somewhere—just another 
scheme to get more work for nothing—although 
they had always been very fairly treated under the 
management of the Hapgoods. 

The first step taken to carry out this new plan was 
the creation of two committees. One was elected 
by the factory force and consisted of ten members. 
The other was appointed by the management and had 
three members. The appointed members were Wil- 
liam P. Hapgood, who was president, the factory 
superintendent, and one other, representing the office 
force. These committees could meet separately or 
jointly, and in each case a majority vote ruled. No 
subject was excluded from the consideration of this 
group that related to the plant as a whole, whether 
it concerned wages, hours, working conditions, or 
general problems of factory management. In the 
beginning Mr. Hapgood retained the power of veto, 
and the plant council was somewhat in the nature of 
an advisory committee. At the end of the first year 
the distinction between the factory and the office 
committees was abolished and one council was elected 
for the plant as a whole. It happened that those 
chosen were the more experienced persons, chiefly 


An Experiment in Industrial Democracy 273 


the heads of departments and their assistants, which 
again seems perfectly natural. 

There followed several years when changes were 
being gradually made in the methods of election and 
in the constitution of the council, as the group learned 
more and more how to handle its own problems. In 
1921 membership in the council was offered to 
“qualifiers.” That is, any salaried employee by at- 
tending eight consecutive meetings could become a 
member. At the same time, it was voted that any 
member should be dropped who had been absent 
from two consecutive meetings without a proper 
reason. Up to this time the board of directors had 
retained the power to act as a check on the actions 
of the council, but by now the other members of the 
Hapgood family had voluntarily withdrawn from 
the board and had been replaced by salaried em- 
ployees of the company. Now only nominal powers 
are exercised by the board. The complete and final 
determination of all company policies rests with the 
council. Finally, in 1923, we reached the stage of 
the operating plan which is in force at present. It 
was decided then that any employee—whether a 
wage-worker or a salaried worker—could become a 
member simply by attendance at a meeting. There 
were no qualifications to be met, and he had the right 
to vote on any question brought up for discussion 
at the first meeting he attended. There is only one 
check put on this method of conducting the business. 


274 Business and the Church 


If, in the judgment of any salaried council member 
who has been a member for a year or more, an 
unwise decision has been reached, he can call for 
another vote on the question, at which time only 
those members who have served a year or more may 
vote. I believe this safeguard has been used only 
twice since the plan became operative. 

In addition to the regular council meetings, which 
are held on the first and third Friday nights of each 
month, after a supper which is served free by the 
company, we have held, since the fall of 1924, an- 
other type of meeting. This is called the factory 
meeting and is held on company time once a month; 
this is done to give every employee a chance to get 
his suggestions or grievances out into the open. 
There are some who, because of family duties or for 
some other reason, find it impossible to attend the 
regular evening meetings, and the factory meeting 
provides an opportunity for them to participate. It 
really serves as a training-school for the council and 
tends to stimulate interest in the management of the 
business for some who would not otherwise be 
reached. The chairman for this group is elected 
by the group, as is also a secretary. Any motions, 
suggestions, or grievances which are brought before 
these factory meetings are taken by the chairman to 
the council for action, and a report is given to the 
factory meeting of the council’s decision. 

Under this plan, which has developed slowly 
through the nine years since its inception, the workers, 


Ee 


An Experiment in Industrial Democracy 275 


as a group, through the body called the council, do 
really manage the business. Since no one is excluded 
and a majority vote rules, they do it democratically. 
There has been a steady growth in attendance at 
council meetings and an increasingly larger number 
of participants in the discussions. This lengthly 
history of the development of the council has been 
included purposely to point out the fact that any 
experiment of this nature requires a long educational 
process and cannot be accomplished quickly. We, 
at the Columbia, know we have not learned nearly 
all there is to know about codperation. We are 
keenly aware of our lacks along certain lines and are 
eager to keep on improving that which has been 
accomplished. 

What, then, has been done during these nine years 
of this kind of management? In the first place, there 
were three features to the plan; namely, the sub- 
stitution of salary for wages, a system of profit-shar- 
ing, and a provision for an increasing and ultimately 
complete control of the concern by those directly 
engaged in production rather than by absentee stock- 
holders. Some of the ways that the council has 
handled these problems and some of the results 
achieved thus far are as follows: 

Substitution of salary for wages means that when 
an employee is placed on salary he is given a certain 
amount each week regardless of the number of hours 
he works. As long as his services continue to be 
satisfactory. he is retained by the year. Thus a 


276 Business and the Church 


salaried employee has a guaranteed income and loses 
nothing when he is compelled to be absent because 
of sickness or for other reasons. He is given a vaca- 
tion based on length of service, a week for each four 
months’ service on salary during the year. It is the 
aim of the council to place every one on salary who 
is likely to be retained on the pay-roll for the entire 
year. No onecan be placed on salary except by action 
of the council, and each individual must prove him- 
self to the group worthy of a salaried position. Also, 
no salaried employee can be dismissed from the ser- 
vice of the company except by action of the council. 
This protects the workers against the old autocratic 
“boss” system of hiring and firing. While we still 
have wage-workers who are paid by the hour, they 
are for the most part the casual workers who are 
hired during the tomato packing season and who can 
be retained for only about three months of the year. 

At the present time we have about one hundred 
salaried employees and three wage-workers who have 
not yet qualified for the salary basis. This con- 
stitutes our regular force. The number is increased 
to about three hundred during the tomato season by 
reason of the highly seasonal nature of our chief item 
of production. 

Each salaried worker is placed absolutely on his 
own honor so far as his attendance is concerned, and 
no time is deducted for any absence. If any one feels 
that another employee is not playing the game 
squarely with the group, he is in duty bound to pre- 


—---- 


An Experiment in Industrial Democracy 277 


sent the case to the council for action. The worker if 
found guilty can be penalized by that body in any 
manner it sees fit. There are remarkably few cases 
of this; it is too hard to get away from the criticism 
of your fellow-workers. More than that, most 
people do have a great deal of honor when given the 
opportunity to exercise it. Once a group gets the 
idea straight that “it’s our business and we must 
make it go for we are all copartners,” they are likely 
to do their level best to make it go! 

All salaries are decided by the council and for the 
most part are set according to the relative difficulty 
of the work performed. We have a scale of salary 
groups into one of which each person is placed. There 
are ten of these groups, and the minimum salary is 
$18 per week, while the maximum is $100 per week. 
These groups range from $18 through nine gradual 
steps to $30, while the tenth one is called “special” 
and is divided into three parts. In this tenth group 
one part includes persons holding special jobs which 
cannot be classified by comparison, such as depart- 
ment heads, salesmen, and buyers; another part 
takes care of girls between the ages of sixteen and 
eighteen, whose working day is limited by law; and 
the third part covers cases when the needs of the 
individual rather than his productive ability is the 
deciding factor. 

Next in line is the consideration of hours, which 
is a big problem in any seasonal occupation. One of 
the unusual features of our plan is that every one 


278 Business and the Church 


works the same number of hours whether he be in 
office or factory. Very early in the life of the council 
this was made a rule, and it caused nearly the entire 
office force to resign before the first year was over. 
They felt the indignity of working the same hours 
as the factory force too great to be borne. Several 
attempts were made to replace these workers with 
people from the outside, but they also left, and so 
it was decided that we should have to draw volun- 
teers from the factory force. We selected the most 
promising candidates and sent them to school and in 
this manner manufactured our own office force from 
people who were in sympathy with what we were try- 
ing to do. This was done in the case of the book- 
keeper. The man selected for that post was a ship- 
ping-clerk. He was sent to day- and night-school for 
a period of intensive training and then assumed the 
bookkeeping job. He is at present treasurer of the 
company as well as head of the bookkeeping depart- 
ment and a very efficient man in both positions. His 
assistants have been selected and trained in the same 
manner. There are other similar instances, and in 
each case the persons thus developed are as efficient, 
if not more so, than the ones they replaced. This 
does not mean that all of our present office force has 
been or must be developed in this way, but the thing 
has been done and can be repeated. 

There are times during the year when our work is 
very light, and there is also a time when it is ex- 
tremely heavy. During the tomato season, which 


An Experiment in Industrial Democracy 279 


usually lasts about six weeks, it is not unusual for the 
plant to operate sixty or seventy hours a week under 
a heavy strain. The salaried force is not paid over- 
time for extra hours, but wage-workers are. If the 
office force finishes its work for the day before the 
plant does, the office people go out into the factory 
and work until the whole force is finished for the 
day. Then during the slack season the hours are re- 
duced just as much as they safely can be. The regular 
working week now is forty-five hours—nine hours a 
day, five days a week—leaving the week-end free for 
rest and recreation. The council decides the length 
of the working day in accordance with business con- 
ditions and tries to make the schedule as easy as it 
possibly can. When there is overtime it is very cheer- 
fully done by the entire group. They realize that 
it is necessary when required. 

Then there is the matter of organization. This 
too is entirely in the hands of the council. Depart- 
ment heads and sub-heads are chosen by the council. 
So also is the placing of salaried workers in depart- 
ments and the transferring of workers from one de- 
partment to another; that is, if the transfer is not 
merely a temporary one. In this way the entire 
matter of promotion and demotion and all other 
personnel problems are placed in the hands of the 
entire group, rather than with a few persons, as is 
the usual custom. It has been customary during the 
past nine years to hold what is known as a series of 
personnel meetings the first of each year at which 


280 Business and the Church 


time the entire force has been gone over individually 
and each department has been carefully considered 
as to the strength and weaknesses of its organization. 
In January, 1925, we held a two-day personnel con- 
ference devoted entirely to considering the organiza- 
tion of departments. It might seem that a group of 
people would not be as ready to act fairly in matters 
pertaining to this phase of the business and might be 
influenced by personal prejudice. This has not been 
true at the Columbia Conserve Company, for the 
council has not hestitated to take action even though 
it meant the demotion of some one universally liked, 
when such action became necessary. 

As for the profit-sharing feature, the first plan 
provided for the division of profits equally between 
common stockholders and workers. The amounts 
paid to the salary pay-roll were issued according to 
individual incomes. In January, 1925, a proposal 
was offered by the major stockholders to the workers 
which makes possible the purchasing of the common 
stock of the company by the council out of the profits 
of the business. 

This new proposal provides for a 10 per cent 
cumulative dividend on common stock, and the same 
percentage on the salary pay-roll, which is not 
cumulative. Then 10 per cent of the remainder of 
the profits is to be set aside for a pension fund. 
Any money remaining after these three provisions are 
met is to be used to buy outstanding common stock, 
that which is held by absentee stockholders to be 


An Experiment in Industrial Democracy 281 


bought first. This stock as it is bought will be held 
by the council in a trust fund, and the ownership of 
the business is to pass into the hands of the council 
when 51 per cent of the common stock has been pur- 
chased by it. 

That is where the experiment stands to-day. In 
summary, our industrial platform, containing eight 
planks, is as follows: 


(1) Full-time employment. 

(2) Full protection against accident, sickness, and 
old age. 

(3) Minimum wage. 

(4) Maximum wage. 

(5) Profit-sharing. 

(6) Abolition of absentee control. 

(7) Workers’ control. 

(8) Workers’ ownership. 


In the first few years of this experiment the prob- 
lems handled were the simpler ones, centering mostly 
around wages, hours, and working conditions. In 
the course of years, under the leadership of William 
P. Hapgood, who has tried to carry the group with 
him as fast and as far as it was capable of going, and 
whose opinions are valued very highly, the council 
has developed in a very marked way until to-day it 
could probably carry on without him if necessary. 
His influence has never been paternalistic; he has 
tried continually to get the workers to take more 
and more responsibility, until now matters of 


282 Business and the Church 


finance, sales, and even other more difficult problems 
of management are within their grasp and are being 
solved by them. 

These workers are not a specially selected group of 
highly trained persons but the same average kind of 
folks to be found in any industry. Most of them 
have only grade-school educations, but, like most 
workers in industry, they are capable of learning 
when given the opportunity. Realizing the need of 
more education and broader knowledge of affairs 
outside our own four walls, the council decided to 
hire a full-time instructor who would work in the 
plant during the day and in the evening teach the 
workers who were interested. Mainly to give us a 
better understanding of our own problems and our 
relation to the outside world this instructor will teach 
us social philosophy and the background of the in- 
dustrial revolution and other subjects which will 
benefit us in our problems regarding human relation- 
ships. This position has been offered to a young man 
in Wales who has’ been teaching the miners along 
the same general lines. Further, about two weeks 
ago it was voted by the council to appropriate a sum 
of money to be used to establish a circulating library 
of our own at the plant. 

Has the experiment been successful? If nine years 
of successful operation prove anything, then it has 
been, for figures prove that the plant is 150 per cent 
more efficient on the economic side than it was before 


An Experiment in Industrial Democracy 283 


1917. The workers feel that the human-relations 
side proves the case even more conclusively. 

As Mr. Hapgood once put it in a letter to another 
industrial leader: 


What is the goal for which labor is striving? Labor is 
trying to get just a little freedom, such a pathetic little 
freedom. Freedom from the domination of those who 
own, freedom to direct their own lives, freedom from the 
involuntary servitude of their mechanical lives, freedom to 
do some creative work. The desire for freedom is one of 
the strongest urges of the human heart, and it cannot be 
denied. Industry must accept it or perish. 


Experiments like that of the Columbia Conserve 
Company are pointing the way toward the day of 
such freedom for millions of workers in industry 
who are to-day virtually slaves. 


INDUSTRY AND HUMAN NATURE 


WILLIAM POWERS HAPGOOD 


PRESIDENT 
Tur CoLtumBia ConsERVE CoMPANY, 
INDIANAPOLIS, INDIANA 


William Powers Hapgood is the president and general sales 
manager of the Columbia Conserve Company at Indianapolis, 
Indiana. 

Born in Chicago, on February 26, 1872, he was taken to the 
small town of Alton in the southern part of Illinois, where his 
early boyhood was spent. 

Graduating from Harvard University with the class of 1894 
he became a clerk for the wholesale grocery firm of Franklin- 
McVeagh Company, of Chicago. He remained with that com- 
pany until 1903, when his family purchased a controlling interest 
in the Mullen-Blackledge Company, of Indianapolis. A reorgan- 
ization of this concern was effected in 1910, and the name 
was changed to The Columbia Conserve Company. At that 
time he was elected to the presidency, and also made sales 
manager, which positions he has held ever since. 

Primarily interested in better human relationship in industry, 
he has steadily gone forward along the path of industrial democ- 
racy and has been chiefly responsible for the experiment which 
is being tried by the Columbia Conserve Company now. 

Since this experiment is almost unique and does seem to point 
the way to a better industrial order, it has attracted a great deal 
of attention in this country and is also known abroad. Because 
of this, Mr. Hapgood has been much in demand as a speaker 
before interested groups. He never fails to give as much time 
and energy to these engagements as the business will permit, 
hoping thereby to spread the idea of the reasonableness and 
the effectiveness of the doctrines of democracy in industry. 


INDUSTRY AND HUMAN NATURE 
W. P. Hapcoop 


Generally speaking, very few ministers have at- 
tempted intimately to relate the teachings of Jesus 
to the daily lives of the people. It is mainly be- 
cause of this failure that the church has lost so much 
of its appeal to manual workers and to the small 
group of people called “intellectuals.” Because the 
first group includes most of those who are financially 
unfortunate, the church does appeal to them in so far 
as it gives them some comfort of assurance that they 
will gain hereafter recompense for what they miss 
in this life; but this appeal is altogether less power- 
ful now than it has been in the past, and it seems to 
be rapidly losing strength, so that one hears fre- 
quently the complaint that manual workers do not 
attend church. 

So far as the intellectuals are concerned, they are 
not as a class interested in the church because the 
church does not concern itself with a careful analysis 
of the facts of daily life. 

What can the church do to change this situation? 
The most important thing is that ministers inform 
themselves as to what is happening in industry. At 

287 


288 Business and the Church 


present most of them naturally take the point of 
view of the wealthier class, because most of the in- 
fluential people in their churches belong to this class. 
The little information which they get on the outside 
which suggests that industry is in bad order is either 
totally disbelieved or largely discounted. It will take 
time, patience, and care to get the facts, but they can 
be secured by those preachers who believe it is im- 
portant to know what is going on in industry. They 
can procure this information either directly by their 
own efforts or indirectly by the efforts of their own 
children. For centuries the church has been in- 
terested in sending missionaries into the “foreign 
fields.’ The converting of a pagan to Christianity 
has had a tremendous call, and to satisfy this call, 
missionaries have been sent into the so-called back- 
ward countries of the earth. But the most fruitful 
mission fields to-day are at our own doors—in the 
coal-mines, in the five-and-ten-cent stores, and in 
most industries, large and small. If the ministers 
would advise their own children, or other young 
people who wish to become missionaries, to go into 
hard manual labor, working underground with the 
miners, or in the lumber-camps of the Northwest, or 
in the steel-mills, these young missionaries would 
bring back to the church the information it needs in 
order to enable it to know if industry is being con- 
ducted at all in accordance with the New Testament 
precepts which they preach. 

Next to love, the most potent influence upon per- 


Industry and Human Nature 289 


sonality is freedom. Freedom permits its possessor 
to do creative work, which leads to a more abundant 
life. Any one who is acquainted with industry knows 
that is it not free. About 95 per cent of the people 
involved in it are virtually serfs. Workers have 
almost no voice in the determination of their own in- 
dustrial affairs, those affairs which have a tremendous 
importance upon their physical and spiritual well- 
being. So long as this system remains, that is, so 
long as the great majority of people spend more than 
half of that part of the day in which they are awake, 
in a situation which not only does not stimulate them, 
but which on the contrary deadens them, society is 
in danger. It is quite unnecessary to give proof that 
workers are not favorably impressed by the environ- 
ment in which they work. Almost any one whom 
you overhear talking in hotel lobbies or on trains, 
almost any industrial leader with whom you may 
talk about the conditions in his shop, complains bit- 
terly of the attitude of the workers. All of them 
seem to place the blame on what is loosely called 
“human nature”; that is, on the belief that man is 
innately brutish or at least unmoral. Such men think 
that the only way to change conditions temporarily 
(none of them think they can be changed perma- 
nently) is by force; that is, by an autocratic system 
under which the workers are penalized when they do 
not work as the employer thinks they should. These 
very same men know, however, that they themselves 
could not work to advantage in such a situation, that 


290 Business and the Church 


their personalities would be warped by such an en- 
vironment. 

If we admit that an opportunity for creative work 
is most essential to the development of personality, 
it follows directly that in order to develop person- 
ality in industry the workers must be admitted into 
its government. To what extent they must be ad- 
mitted is not essential in the beginning, but it 1s most 
essential that a start should be made in that direc- 
tion. Probably if such a start is made, it will ul- 
timately result that the workers will gain more and 
more voice in industry until perhaps in the distant 
future they will control it. 

I know that virtually every one to-day believes 
that workers cannot manage their own affairs. I 
know that such experiments have failed in the past, 
but it does not necessarily follow that they must fail 
in the future. 

John R. Commons, of the University of Wiscon- 
sin, in the November issue of the Atlantic, writes as 
follows: 


In every case that I know of, and in every country, 
where working men have formed the so-called Producers 
Codperatives, in order to become, as they say, their own 
employers, and have thus elected their own foremen, super- 
intendents, and directors, they have failed. Labor as a class 
is incompetent to elect a boss. 


In this same article he shows quite clearly how 
Ricardo and Marx reached false conclusions by not 


Industry and Human Nature 291 


knowing all the facts, and yet Mr. Commons makes 
a dogmatic statement simply based upon the few ex- 
periments that have been made in the past. No doubt 
he would say as so many others say, that it is “human 
nature” that workers are incompetent, that is is “hu- 
man nature” that they cannot elect their own bosses. 
I contend that neither Mr. Commons nor any one else 
is justified in making such a statement based upon 
the negligible number of experiments that have been 
made along this line in the past. When industry has 
made one tenth of one per cent as many experiments 
in human relations as it has made in the mechanical 
and natural sciences, it may have some reason to 
believe that it knows something about how human 
beings will act under certain conditions in industry. 
Capitalists and employers have been immensely 
adventurous in dealing with things, but they are as 
timid as children with reference to dealing with 
people. Thousands of men can be courageous in 
the face of physical danger, who lack the courage 
for an adventure in human relations. Never have 
men endured risks for greater stakes than when they 
have adventured for “good will among men,” but 
how many men are willing to do this in industry? 
They defend their timidity by saying that industry 
is a practical science. Ministers, teachers, surgeons 
are willing to devote a large part of their lives to 
service, but when a man does that in industry he is 
called a fool. Man is considered less human in in- 
dustry than he is in other occupations. Can he be 


292 Business and the Church 


Christian only in the church, and must he always be 
pagan in the shop? 

Recently when I was talking before a group of 
about forty ministers in an Ohio city, in reply to a 
statement of mine that the more productive units 
in industry should not be paid much more than the 
less productive, one of them said it would n’t work 
because it was n’t in accordance with human nature. 
I asked him: “Why do you remain in your profes- 
sion when you can get more on the outside? Why do 
you assume that you are better than I because you are 
in the ministry and I am in industry? Is it not be- 
cause you and others have permitted industry to set 
for itself a false goal, because you have been willing 
to say to those men in secular occupations, ‘We will 
not measure you in accordance with the standards 
which we mete out to ourselves’? We know that 
when society sets a certain valuation on a certain kind 
of conduct, accepting that conduct at that valuation, 
that conduct will not change. If we accept the thief 
merely as a thief, he remains a thief. A few years 
ago when society concluded that every female worker 
in a canning factory and every waitress in a shop was 
a prostitute, many of them were such. It is equally 
true that as long as society, including the church, 
believes industry must be pagan, it will remain pagan. 
Can the church teach a new evaluation of industry? 
Or will it wait until here and there a few men in 
industry, finally aware of the great delusion that the 
chief incentive in industry is profits and not service, 


Industry and Human Nature 293 


lead industry out of servitude? Fortunately this 
movement has already started, though very few are 
aware of it. Many industrialists are beginning to 
appreciate the necessity of a different relationship 
between those who own property and those who work 
for them, and some of them realize how much more 
stimulating and adventurous human relations in in- 
dustry are than material profits. 

It happens that I have been concerned with a small 
industry which for nine years has had as its chief goal 
the development of its employees. I can say from 
personal experience that the thrill of such an ex- 
periment is worth infinitely more than the excite- 
ment which comes from profit-making. Further- 
more I can say from experience that the contention 
made by Professor Commons and others is not in- 
evitably true. Certainly it is not so with the ex- 
periment with which I have been connected. During 
the course of nine years we have developed out of the 
ranks of manual labor a group of technicians who are 
running our plant much more effectively now than 
it was run under the autocratic system prevailing nine 
years ago. Mr. Commons, to be sure, has not said 
that manual laborers cannot be developed into techni- 
cians, but he has said that manual laborers cannot 
govern themselves. I deny this absolutely. After 
an apprenticeship of some years, the workers in this 
company have taken over complete control of the 
management of the business and now decide all ques- 
tions pertaining to it. At the very time I am dictat- 


294 Business and the Church 


ing this letter, about fifty of our workers are sitting 
in conference together to decide, absolutely unin- 
fluenced by me or by the other owners of the business, 
which of two contracts offered them by the major 
stockholders they will accept. Both contracts look 
to the complete ownership of the business by the 
workers, but differ somewhat in the steps leading 
thereto. No more important contract than this could 
be considered by any group of men, whether workers 
or managers. Nine years ago this group of workers 
began to decide the length of their working week, 
set their own wages, selected their own leaders, in- 
cluding their superintendent and their manager, and 
finally came to consider matters of finance. We have 
not definitely proved our case to such an extent that 
this business may not fail, surrounded as it is by a 
capitalistic environment, but we have definitely 
proved that under this system our efficiency has in- 
creased approximately 150 per cent and that our busi- 
ness is much more profitable than it was nine years 
ago. Whether this system will endure, only the 
future will tell, but any one who considers that 
others are approximately as virtuous and intelligent 
as himself when brought into the same environment 
will have confidence that this relation will succeed. 
Of course the man who believes that almost every- 
body else is a moron or a crook will think such an ex- 
periment absurd. 

In my judgment, industry, like government, can- 
not remain half slave and half free. We must 


Industry and Human Nature 295 


achieve in industry Lincoln’s definition of democracy: 
“Of the workers, by the workers, and for the 
workers.” What does this mean? If I were to trans- 
late it into a platform, I would state it as follows: 
(1) full-time employment; (2) full protection 
against sickness, accident, and old age; (3) minimum 
wage; (4) maximum wage; (5) profit-sharing; 
(6) abolition of absentee control; (7) workers’ con- 
trol; (8) workers’ ownership. 

In this platform you will notice that the fourth 
plank speaks of a maximum wage. I can think of 
no really effective producers’ society in which the 
leaders would take very much larger compensation 
than their associates. You will remember Jesus an- 
swered his disciples when they were quarreling 
among themselves as to who was the greatest in these 
words: “Whosoever will be chief among you, let 
him be your servant.” The greatest among us are 
those who render society the most service and not 
those who make most out of society. 

Bassi wrote: 


Measure your life by loss instead of gain, 
Not by the wine drunk, but by the wine poured forth. 


Recently I have had some correspondence with 
the president of an Ohio college, and he writes as 
follows: 


I am not in agreement with your ideas of compensation 
irrespective of service rendered. I think that such a posi- 


296 Business and the Church 


tion cuts across fundamental qualities of human nature and 
character, also cuts across social well-being. I think that 
it is to the well-being of society that the more productive 
units of society should be given more favorable opportunity 
for survival and increase. 


I replied to his letter as follows: 


I do not see why compensation in the sense in which you 
use it, namely, money compensation, should be applied only 
to industry. Of course you know that in many services the 
measure of a man’s success is not in money compensation. 
In my judgment it is because this kind of compensation has 
been used as its only measure of success that industry is so 
fundamentally unmoral. I can see no reason why human 
nature should act differently in industry from what it does 
in the ministry, in surgery, or in your profession. I feel 
quite confident that you are not receiving in money compen- 
sation from your present work what you could get on the 
outside. If that is the case, why is it? Is your nature any 
different from mine because I am in industry? I quite 
agree with you that the more productive units of society 
should be given more favorable opportunities for survival, 
but how can we tell if certain units are more productive 
until we give them a favorable opportunity? You know 
that there is very little opportunity given the average man in 
industry for survival, in the sense in which you have used 
the word. Our fundamental objective in trying our ex- 
periment is to accomplish just that. 


Kipling, in “The Explorer,” wrote: 


Industry and Human Nature 297 


“There’s no sense in going further—it’s the edge of culti- 
vation,” 

So they said, and I believed it—broke my land and 
sowed my crop— 

Built my barns and strung my fences in the little border 
station, 

Tucked away below the foothills where the trails run 
out and stop. 

Till a voice, as bad as Conscience, rang interminable 
changes 

On one everlasting Whisper day and night repeated— 
sO: 

“Something hidden. Go and find it. Go and look behind 
the Ranges— 

Something lost behind the Ranges. Lost and waiting for 
you. Go.” 


Yes, your “Never-never country’—yes, your “edge of 
cultivation,” 

And “no sense in going further’—till I crossed the 
range to see. 


Anybody might have found it but—His Whisper came 
to me! 


1 saan { ‘ 
: h 
' i 4 pS seve): u i 
‘ yo Cae , ah ) 
i ; +) 
a 
{ 
‘ 
i 
’ 
j 

j 

bt 

) 

¢ 

hy 

f 

‘ 

‘ 
y , 
i. ° 

Lr 

-? 
i 
] 
/ 4h. 


COOPERATIVE MANAGEMENT WITH 
THE LABOR-UNION 


BENJAMIN MARK SQUIRES 


Reading of Mr. Squires’s activities in the labor world reminds 
one of Dr. Oliver Wendell Holmes’s observation that he occu- 
pied, not a chair, but a settee in Harvard University. 

A list of Mr. Squires’s connections is very interesting reading: 

Special agent, United States Bureau of Labor Statistics, 1914- 
16; commissioner of conciliation, United States Department of 
Labor, 1916-20; member Alaskan Board of Mediation and 
Arbitration, 1916; administrative member and chairman, New 
York Harbor Wage Adjustment Board, 1917-18; executive 
secretary and advisory member, National Adjustment Com- 
mission, 1919-20; statistician and assistant, Employers’ Euro- 
pean Commission appointed by the United States Department 
of Labor, 1919; lecturer on industrial relations, Columbia Uni- 
versity, 1919; chairman Trade Board, Men’s Clothing Industry, 
Chicago, 1921—; investigator, United States Coal Commission, 
1923; lecturer on political economy, University of Chicago, 
1924—; chairman, Unemployment Insurance Fund, Men’s 
Clothing Industry, Chicago, 1925—. 

In addition to his activities in the interests of labor, Mr. 
Squires has written on the following subjects: Operation of 
the Canadian Disputes Act; Labor Cost and Productivity in the 
Lumber Industry; New York Harbor Employees; Peace along 
Shore; Coastwise Shipping Menaced; Associations of New York 
Harbor Boat-owners and Employees; New York Harbor Strike; 
New York Harbor Wage Adjustment; Strike of the Longshore- 
men at the Port of New York; Women Street-Railway Em- 
ployees; Marine Workers’ Affiliation of the Port of New York; 
Waterside Workers in the United Kingdom; Demobilization 
and Resettlement in the United Kingdom; Reabsorption of 
Labor and Unemployment in the United Kingdom; British 
Labor Exchanges and United States Employment Offices; Joint 
Shipping Industrial Conference; the National Adjustment Com- 
mission; Longshore Labor at the Port of New York. 

Mr. Squires was born in Wisconsin and received the degree 
of B.A. from the university of his native State. He also has 
a Ph. D. from Columbia University. 


COOPERATIVE MANAGEMENT WITH 
THE LABOR-UNION 


BenyAMIN M. Squires 


Of utmost significance in the field of industrial re- 
lations is the recognition by capital and labor that 
many of their differences, so-called, are not irrecon- 
cilable. The question of what share each shall have 
of the wealth produced is still a matter of dispute and 
doubtless will continue to be, but the area of con- 
troversy has been limited sharply and the issues have 
been more clearly defined. The opposition of labor 
to the introduction of machinery and improved 
methods of production generally has been overcome 
in considerable degree. The feeling on the part of 
management that its problems cannot be understood 
by labor and that labor’s only interest is to produce 
less for more wages is being dissipated. Both man- 
agement and labor appear to have accepted the view 
that high wages and a high standard of efficiency 
are somewhat related. What might be called a moral 
partnership in business is developing here and there, 
and may be said to mark a new era in industrial re- 
lations. 

It is not my purpose to explore in detail the proc- 
esses by which this change in the attitude of capital 

301 


302 Business and the Church 


and labor is being accomplished. It may be said in 
passing that war made of codperation a vital need. 
It gave an impetus to large-scale organization of 
labor and capital. Labor found itself possessed with- 
out a struggle of many of the things it had been 
fighting for and could afford to turn its attention to 
other problems. Leaders of labor and of business 
who had never met before sat at the same table and 
discovered common interests. Respect and con- 
fidence developed from such contacts. The need for 
codperation continued to be imperative as industry 
began to adjust itself to peace-time conditions. The 
depression made for abrupt retrenchment, wrecked 
many businesses, left millions unemployed, and 
forced attention anew upon conditions which hinder 
industrial progress. 

These are some of the recent influences making for 
codperation. They should not be permitted to over- 
shadow the preparation of industry for the event. 
Codperation has long been an expressed principle of 
action, though at times it may have seemed no more 
than a pious wish. Long before the war, labor learned 
from bitter experience that resistance to improve- 
ments was not only costly but futile. Many em- 
ployers had learned the value of good will in dealing 
with labor and were trying to secure it. Embodied 
in trade agreements or in the preambles to such agree- 
ments have been professions of belief in peaceful ad- 
justment, the intent to codperate, to recognize and’ 
safeguard rights. Leaders on both sides have sought 


Codperative Management 303 


to relieve industry of the never ending cycle of dis- 
location and readjustment and have preached the 
doctrine of codperation as a sound practice whether 
business was good or bad. 

Experiments in the field of codperative manage- 
ment have been watched closely and have been fruit- 
ful not only in overcoming prejudices but in making 
for enthusiastic response. The most outstanding of 
such experiments is to be found in the men’s cloth- 
ing industry. It is outstanding because of its accom- 
plishments, but these are the more remarkable be- 
cause of the obstacles to be overcome. A sweated 
industry, immigrant workers in large numbers, 
women workers aggregating fully 50 fifty per cent, 
autocratic control by management, stern competition 
accentuated by the relative ease with which new shops 
could be organized, innumerable small shops, an in- 
dustry spread over the greater part of the country— 
these are some of the barriers which were faced and, 
in large measure, surmounted. 

For the purpose of this analysis the development 
of industrial relations in the men’s clothing industry 
must be traced from 1910, when a bitter strike of 
four months’ duration occurred in the shops of Hart, 
Schaffner & Marx, of Chicago, the largest manu- 
facturer of men’s clothing in the country. The strike 
was conducted by the United Garment Workers of 
America. During the strike, leading Chicago citizens 
interested themselves and assisted largely in work- 
ing out an agreement providing for the adjustment 


304 Business and the Church 


of grievances by a committee of arbitration. The 
attitude of the firm itself was most helpful. Despite 
the feeling at the outset that the strike was an act of 
ingratitude, the firm faced squarely the reasons for 
discontent and entered whole-heartedly upon the 
task of bettering its relationship with the workers. 
Without this support by the firm the experiment thus 
begun might well have proved a dismal failure. 

It was not contemplated that permanent arbitra- 
tion would be created or required. The agreement 
on this point provided that the arbitration committee 
“shall fix a method for settlement of grievances, if 
any, in the future.” The company itself created a 
labor department to take general charge of all its 
dealings with employees. Grievances requiring refer- 
ence to arbitration became so numerous, however, 
that in 1912, on the recommendation of the arbitra- 
tion committee and others, a court of original juris- 
diction—the trade board—was created to pass on 
complaints not involving basic principles of the agree- 
ment. Rapid progress was made in the elimination 
of abuses and the establishment of rights which dig- 
nified the relationship between management and 
labor. 

In 1913 the agreement was renewed for three 
years, with recognition of the principles of preference 
to members of the United Garment Workers of 
America. Shortly thereafter a split occurred in the 
ranks of the union. A new organization, the Amal- 
gamated Clothing Workers of America, came into 


Codperative Management 305 


being, with Sidney Hillman—formerly a cutter at 
Hart, Schaffner & Marx—as its president. The new 
organization was without funds and with limited 
membership, but it had faith and enthusiasm, an in- 
domitable spirit, and a favorable opportunity for the 
development of constructive leadership. 

With the advent of the World War, accompanied 
by unbounded prosperity, expanding industry, 
rapidly mounting prices, profits, and wages, a short- 
age of labor, the stage was set for a rapid increase of 
union membership in industry generally. When this 
country entered the war in 1917 the policy of the 
Government in recognizing organized labor was a 
further aid to organization. The period from 1915 
to 1919 witnessed a growth in the membership of the 
Amalgamated unequaled in labor history in this coun- 
try. By 1919 all the important markets had signed 
agreements with the Amalgamated and had working 
arrangements patterned after, if not paralleling, that 
begun at Hart, Schaffner & Marx. Hours had been 
reduced to forty-four a week. Wages were raised 
to a point comparable with the best conducted in- 
dustries. A body of rules and practices designed to 
protect the interests of workers and management 
had become a part of the working agreement. 

Although taking advantage of the opportunity to 
extend its organization and to improve the status of 
its members, the Amalgamated was tolerant in the 
exercise of its newly acquired power and did much 
to stabilize the industry. It used all its influence to 


306 Business and the Church 


prevent job-grabbing and job-baiting. It forced con- 
tractors to maintain conditions prevailing in the shops 
of manufacturers. It advised against an over-ex- 
pansion of the industry. It subscribed to a system of 
impartial boards and gave them power to decide dis- 
puted issues. Only an organization sound basically 
and led by men of vision could have done this. 
Coincident with the organization of the various 
markets by the Amalgamated, manufacturers began 
to set up organizations somewhat comparable. Mar- 
ket committees were formed. Each of the larger 
houses employed a labor manager, who devoted his 
entire time to the labor problems of the house. The 
smaller houses worked out an arrangement whereby 
one labor manager served several houses. In 1920 
the markets were loosely united into what was known 
as the National Industrial Federation of Clothing 
Manufacturers, the purpose of which was primarily 
to keep the several markets informed and to secure 
unified action in treating with labor. Like many 
associations of employers, the market organizations, 
and the Federation in particular, have not developed 
the unity of action that labor is able to develop. 
What should be problems for the entire industry to 
tackle, or at least for an entire market, are set aside 
frequently for the more immediate needs of the 
individual plant. The organizations have, for in- 
stance, been unwilling, or unable, to approach some 
of the major problems of distribution. This is a 
goal for the future and one which must be kept in 


Codperative Management 307 


mind by labor as well as by capital if the industry is 
to prosper. 

Whatever test the new arrangement for collective 
action in the industry may have been subjected to in 
the period from 1915 to 1919 is insignificant in con- 
trast with the test from 1920 onward. The industry 
was greatly over-expanded by 1919. Some super- 
authority would have been necessary to prevent the 
expansion, and that authority was not in evidence. 
By the end of 1920 the industries of the country 
were in the throes of a general depression. In ad- 
dition to sharing in the general industrial depres- 
sion, the clothing industry appeared to be faced with 
what has been termed a buyers’ strike. For this 
condition the industry itself was partly to blame. 
During the boom, production was speeded up, some- 
times at the expense of quality. Prices were unnec- 
essarily high. Retailers and customers were very 
much at the mercy of the manufacturer. Anything 
sold. When the prices of other commodities began 
to fall, the price of clothing did not at first fall 
proportionately. Employers blamed the union for 
not agreeing to wage cuts. The union felt that the 
rate of profit would permit a cut in prices without 
disturbing wages. Consumers blamed the industry 
for not doing its share of deflating. 

So sharp was the decline in business and the in- 
crease 1n unemployment that in a wage case heard 
early in 1921 the board of arbitration awarded a de- 
crease approximating 10 per cent. This cut in wages 


308 Business and the Church 


appeared to have little if any effect on the situation. 
Business continued to shrink, and unemployment 
continued to grow. To many employers in this and 
other industries the moment seemed at hand to break 
down organizations of labor. That their efforts were 
attended by some measure of success is evidenced by 
the loss to organized labor of more than a million 
members in less than two years. In the clothing 
industry the New York manufacturers declared a 
lockout late in 1920 and continued to fight until the 
spring of 1921, when they renewed the agreement 
with the Amalgamated. In some of the other cloth- 
ing markets sporadic attempts were made to break 
with the union. A few manufacturers were success- 
ful and reopened their plants as open shops. A few 
others moved out of town. Some manufacturers 
found the occasion ripe to enter the clothing industry 
on a non-union basis. In the meantime the industry 
continued the process of liquidation. Some concerns 
went into bankruptcy; others realized from the situa- 
tion what they could and ceased to operate. 

In 1922 in response to urgent representations of 
leading manufacturers the union accepted a wage 
decrease of about 10 per cent voluntarily. This did 
not stem the tide, but early in 1923 industry gener- 
ally showed signs of activity, and the clothing in- 
dustry was quick to respond. For the first time since 
1919 all the workers in the industry were employed, 
and there was an actual shortage in some depart- 
ments. The union asked for and received an increase 


Codperative Management 309 


of 10 per cent, part of the increase in the Chicago 
market being diverted to the creation of an unem- 
ployment insurance fund. Before the year was over 
another depression set in, and again in 1924 the 
Chicago manufacturers asked for a wage reduction. 

The response of the Amalgamated to the 1924. 
demand for a general wage reduction was to propose 
that the problems of individual concerns be con- 
sidered on their merits. This led to an analysis of 
labor costs, shop lay-out, overhead, sales methods, 
and the kind of competition which each firm had to 
meet. Adjustments were made which did not affect 
wage levels. Operations were simplified. Needless 
operations were eliminated. Shops were reorganized. 
The net result was a saving far greater than could 
have been realized from a wage cut and without re- 
ducing earnings. It is this sort of codperation which 
marks the new departure in the relation between or- 
ganized labor and management. Up to this time the 
Amalgamated had met emergency situations in a 
number of establishments, but it did not openly de- 
clare its policy. The time-honored practice of cut- 
ting wages in times of depression and raising them 
during prosperity seems to have made the leaders of 
the Amalgamated timid in insisting on the possibility 
of any other course. If so, they must have been em- 
boldened by success. 

In the same manner active codperation in manage- 
ment has been resorted to in all markets. The indus- 
try as a whole has not recovered from the depression, 


310 Business and the Church 


though it is much nearer to normal requirements 
than during the period of expansion. But in 
spite of the continued depression, there is little talk 
of a wage cut. Instead, both sides get together to 
discuss and meet problems as they arise. Is a firm 
suffering from high overhead by reason of a highly 
seasonal product? The union assists in introducing, 
and even urges, an inter-season product. Does a firm 
want to meet a certain competitive price level? The 
union attempts to meet competitive labor costs, as- 
sists in reducing overhead by taking some of the 
responsibility of supervision, and helps to work out 
the details of garment construction. Isa firm handi- 
capped by costly and unnecessary practices? The 
union helps to eliminate them. Isa firm in financial 
difficulties? On several occasions the union has been 
a party to a financial reorganization and has even 
gone so far as to arrange for an extension of credit 
at the bank which held the firm’s paper. All this 
means that the union is taken into the confidence of 
the manufacturer in regard to costs, overhead, profits, 
accounts, and business practices. It means that the 
union is actually participating in management and as- 
suming part of the responsibility of the industry. 

It was in the same spirit of codperation that em- 
ployment exchanges—managed by the union—and 
unemployment insurance were created. For several 
years employers in the Chicago market complained 
that workers sent by the union did not fit the jobs, 
that politics played a part in the selection of workers. 


Codperative Management 311 


The board of arbitration went so far as to state em- 
phatically that a grab-bag system prevailed and that 
a joint employment office should be set up. The 
union employed an outsider, the director of the 
Public Employment Service of Canada, to reorganize 
and manage its employment exchange. Jobs were 
analyzed. The nature of the work in the different 
houses was made a matter of record. The experience 
of each registrant was scrutinized carefully. When 
a call came for a worker, the worker best fitted for 
the job was sent. The employers were satisfied. 
Under the same direction exchanges are being or- 
ganized in all the important markets. 

When the Amalgamated first broached the sub- 
ject of unemployment insurance, scant, if any, con- 
sideration was given. Two years later an agreement 
was reached to establish an unemployment insurance 
fund by joint contributions and: to administer the 
fund jointly, with final reference to a chairman in 
case of disagreement. Some employers entered into 
the arrangement because they believed that industry 
should carry the risk of unemployment. Others 
agreed to it as a matter of reciprocity. The fact 
remains that the fund was created by agreement and 
is maintained and administered jointly. Since May, 
1924, more than two million dollars have been paid 
out in benefits. The drain on the fund has been 
heavy because of continued depression, but rules have 
been modified to maintain the solvency of the fund, 
and the experimental stage has been passed. Manu- 


312 Business and the Church 


facturers in the New York market have agreed to 
establish unemployment insurance, and the agree- 
ment with the A. Nash Company, of Cincinnati makes 
like provision. The extension of the plan to all 
markets is a matter of time. 

Reference has been made to the impartial ma- 
chinery set up in the various markets. With the 
exception of a brief interlude in the New York mar- 
ket, the machinery has functioned continuously, 
though with changing personnel, since it was estab- 
lished. Much has been written about the work of 
these impartial boards and the industrial codes re- 
sulting from their decisions. As a matter of fact, 
the tendency at the outset was toward law-making 
rather than law-interpreting. The impartial chair- 
men were not alone responsible for this. Both sides 
were reluctant to make their own decisions. Dockets 
were flooded with cases. Decisions were cited as 
precedents. The chairmen became official scapegoats 
and were accordingly sacrificed at times. Then came 
a pause, and both sides took inventory. Both sides 
began to assume greater responsibility and to make 
their own decisions in matters of basic policy. Ar- 
bitration became more and more a matter of media- 
tion and interpretation. The chairmen continue to 
decide many cases concerning procedure and practice, 
but the great bulk of complaints are adjusted in con- 
ference and by agreement, without formal decision. 
By the very fact of the change the chairmen enjoy 
greater confidence from both sides; they are in posi- 


Codperative Management a3 


tion to counsel, to advise courses of action, and to 
prevent irritation. Continuous arbitration has be- 
come possible in the clothing industry because the 
union and the manufacturers no longer shift the 
burden of critical decision to the arbitrator. Here 
again the qualities of leadership have been revealed. 

Such, in brief, are some of the things which have 
been accomplished in the men’s clothing industry by 
way of codperative management. A few of the 
obstacles have been cited because they are especially 
significant. In appraising the experiment, due credit 
must be given to the circumstances under which it 
was begun. It may be said to have been cradled in 
idealism. It was carried on by men who had a deep 
knowledge of human nature and faith in it. It was 
watched critically and sympathetically by those who 
first sponsored it. But whatever of idealism remains 
—and there is much—the arrangement continues be- 
cause it has been found to be profitable. The need to 
survive may have forced codperation—it probably 
did—but what has long been a principle of action has 
been translated into practice. Future problems will 
be met in the same way because the industry believes 
in it and because it is good business, 


EMPLOYEE REPRESENTATION 
TO-DAY 


JOHN W. RIEGEL 


REsEARCH SUPERVISOR 
Bureau oF Business RESEARCH, 
Harvarp UNIVERSITY 


Mr. Riegel served during the war in the labor department 
of the Naval Aircraft Factory in Philadelphia. At the close of 
the war he went to Harvard as instructor in labor relations, 
Harvard Business School, and held this office from 1920 to 
1925, when he was made supervisor. 

During 1924 and 1925 he conducted a first-hand study of 
employee representation in more than fifty companies, manu- 
facturing plants, public utilities, etc. A case on industrial rela- 
tions, edited by Mr. Riegel, will soon appear in the series of 
Harvard Business Reports. 


EMPLOYEE REPRESENTATION TO-DAY 


Joun W. RIEGEL 


Employee representation is accomplished when the 
wage-earners in a business organization select spokes- 
men from their group to deal with the company’s 
officials regarding subjects of mutual interest. The 
title is used to refer to experiments that have a few 
external features in common but which differ funda- 
mentally in their purposes and methods of operation. 

The idea of organizing human relations within the 
workshop gained vogue during the World War. The 
then abnormal demand for labor, both military and 
industrial, conferred great economic power on em- 
ployees. Primarily because of their strategic posi- 
tion at the time, they presented demands of such 
seriousness that the attention of business executives 
was fixed upon labor problems, and the executives 
looked about for preventive methods of dealing with 
labor problems. 

In 1917, an English parliamentary document 
known as the Whitley Report suggested that labor 
relations be organized within business establishments 
and industries to bring about frequent conferences 
between managers and workmen. That report 
aroused interest not only in Great Britain but in the 

317 


318 Business and the Church 


United States.* Shortly thereafter, in this country, 
the War Labor Board and other federal agencies 
dealing with labor problems in “essential”? war-time 
industries indorsed employee representation and put 
it into effect in many companies during the period of 
the national emergency. The spirit of the time, 
moreover, favored some democratic scheme that 
would afford workmen a voice in the determination 
of the conditions of their employment. The years 
1918 and 1919 witnessed the entrance of many com- 
panies upon experiments with shop councils. 

Many of those shop councils were intended to deal 
with existing labor difficulties and to make working 
adjustments that would continue operations from 
day to day without a strike. They were not adopted 
as permanent means to work out constructive pro- 
grams, and when the period of labor shortages ended 
in 1920, most of them were abolished. 

Some of the conferences with employees, however, 
were continued because they had been found to pro- 
mote codperative efforts for mutual advantage. 
From 1921 to 1926 the growth of works councils has 
continued. It has been slower than during the first 
period but more deliberate and better founded. Ex- 
periments begun in the second period were entered 


*The recommendations of the Whitley Report were similar to 
those in a document issued by the Garton Foundation (British) in 
June, 1916. In this country a number of companies had estab- 
lished employee representation even before the date of the Garton 
Report. The Whitley Report focused attention on those experi- 
ments. 


i 


Employee Representation To-day 319 


upon, in the main, as permanent departures from 
former methods of employee relations and for con- 
structive purposes. In 1924 one research agency re- 
ported that in the United States more than eight hun- 
dred works councils were in operation and that more 
than a million wage-earners were represented in those 
bodies.” 

In Great Britain the works-council movement 
rested on a voluntary basis, although the Government 
for some time fostered the scheme outlined in the 
Whitley Report. Several continental countries, 
notably Germany, Austria, and Czechoslovakia, have 
passed laws requiring the establishment of works 
councils in business organizations above a certain size. 
The voluntary basis of development is best suited to 
American conditions; and, because of the varying pur- 
poses to which employee representation may be put, 
the installation of works councils by legislative fiat 
is questionable in any case. 

In a review of employee representation, it 1s nec- 
essary to penetrate externals and to seek the objec- 
tives of the arrangement as demonstrated in its opera- 
tion. These purposes may be roughly grouped into 
two classes. The first class includes those aims which 
are momentary in character. These were prominent 
in the years before 1920. At that time, some works 
councils were installed to temporize with existing 
emergencies; another purpose was to offset the appeal 


2 National Industrial Conference Board, Special Report No. 32, 
New York, 1925. 


320 Business and the Church 


of labor-unions by offering a substitute; still another 
was to advertise a company as a progressive employer. 
Some of the employee representation of this char- 
acter established safety-valves so that employees’ dis- 
satisfaction would spend itself in harmless discussion. 

The objectives of the other group are of a different 
sort. They contemplate that employee representation 
is a permanent operating plan, and that an attentive 
regard to employee sentiment as expressed in the 
works council is to be a definite obligation on the part 
of company officials. The constructive purposes of 
employee representation are: (1) to afford employees 
a voice in shop government and, so far as possible, to 
enlist their consent; (2) to interchange views and 
experience, that is, to educate employees in company 
matters of direct interest to them, and to educate 
executives regarding the points of view of the workers 
both individually and in groups; (3) to administer 
welfare and service activities, such as mutual aid 
funds, company tenements, group insurance; (4) to 
negotiate terms of employment. 

Experiments with employee representation differ 
markedly in the relative importance attached to these 
purposes. Thus a plan intended to be chiefly edu- 
cational in nature is organized and carried on in a 
manner quite different from a plan used mainly to 
negotiate wages and working conditions. 

Works councils may be partizan or bipartite in their 
make-up. The bipartite council is predominant in the 
United States. Under that system, representatives 


Employee Representation To-day 321 


of the employers meet regularly with the employee 
spokesmen. There are a number of plans, however, 
in which the employee representatives meet sep- 
arately. Even under plans which stress partizan 
meetings to induce unrestricted debate in the em- 
ployee group, joint conference committees exist in 
which views may be interchanged and negotiations 
carried on. 

Much debate has taken place regarding the power 
that works councils ought to have. It should be clear 
that in case a works council is organized chiefly as an 
educational agency, the question of power is entirely 
out of place. On the other hand, if a works council 
is intended to administer mutual aid funds or other 
welfare activities, it must have a certain degree of 
administrative power. Should the works council be 
concerned largely with matters of shop government, 
disciplinary measures, and production problems, it 
needs only the power of discussion and recommenda~- 
tion. Final authority to conduct a business must re- 
main, under the economic system of private enter- 
prise, with the executives operating it in behalf of the 
stockholders who shoulder the risks of the venture. 
That does not prevent the executives from giving the 
most careful attention, in their management of the 
plant, to the opinions of the employees. 

The representatives upon a works council in which 
terms of employment are to be negotiated should be 
able to speak authoritatively for their constituents or 
principals and to conclude agreements, the provisions 


S22 Business and the Church 


of which then may be embodied in the contract of 
hire which the employer has with each employee.? 

The uses and limitations of employee representa- 
tion cannot be spoken of in general terms; they de- 
pend upon the circumstances, both personal and eco- 
nomic, of the particular case. A leading question in 
this type of experiment is whether, satisfactory labor 
relations are essential to a firm’s success. Any out- 
sider will recognize that employees doing simple and 
repetitive tasks are, as individuals, of little importance 
to the success of a company, whereas employees carry- 
ing a large degree of responsibility for a firm’s service 
or its property are in a different class. Thus em- 
ployees who deal directly with customers, who are 
called on to exercise discretion in the regular course 
of their work, who are responsible for valuable mate- 
rials or for the operation of expensive equipment, are 
important as individuals to the success of the company 
with which they are associated. Satisfactory rela- 
tions with such employees are worth while purely as a 
“business proposition,” and their employers are likely 
to be deeply interested in plans—such as employee 
representation—to improve those relations. 

Two other economic considerations influencing the 
possibilities of employee representation are the sta- 
bility of the industry and the competitive position of 
the individual firm. A well managed company that 


* This statement does not refer to the so-called individual con- 
tract, which is an anti-union device, but to the usual contract of 
hire, which is merely an agreement regarding services and wages, 


Employee Representation To-day 323 


has prospects of continued success in a relatively stable 
industry is in a position to adopt long-run policies and 
to build the foundations of labor good will, through 
employee representation for example, with reason- 
able anticipation that the good will engendered will 
result in the further success of the company in subse- 
quent years. 

Personal factors also play a large part in the oper- 
ation of an employee-representation plan. The char- 
acter and views of both employer and employees are 
of significance. The experiment is not suited to the 
employer who wishes to run his business without being 
trammeled by the effort and delay frequently im- 
posed by the duty of conferring with employee rep- 
resentatives. On the other hand, employees holding 
the doctrine of economic class warfare do not react 
favorably toward employee representation. They 
view any concessions granted through its channels as 
the belated return of some of the fruits of exploita- 
tion, and they feel slight interest in the program as a 
codperative effort for mutual advancement. 

Employee representation in shop government has 
had small success in those plants whose administra- 
tion is not of a high order. In several such instances 
junior executives really have not had the opportunity 
to deal adequately with personnel problems. The 
supply of raw materials, the operating condition of 
equipment, the adequacy of tools and instructions— 
in a word, working conditions—have been so unre- 
liable, from the employees’ standpoint, that em- 


324 Business and the Church 


ployees had grounds for many complaints which the 
management was unable to correct. In such cases, 
employee representation had an adverse effect upon 
administrative relations and aroused the opposition 
of foremen and superintendents. This experience 
justifies the statement that employee representation 
is not of itself sufficient to improve business admin- 
istration; employee representation can simply bring 
difficulties to light, and the correction of the diffi- 
culties must depend largely on the ability and the 
open-mindedness of the management. 

As an educational device, employee representation 
is limited if unattractive circumstances lie in the back- 
ground. The subject-matter to be discussed and the 
personalities to be revealed in an educational program 
will condition the effects of that program. If matters 
that normally would be the subject of inquiry on the 
part of employees would, when explained, be inex- 
cusable from their standpoint, it would be better for 
the employer to correct the situation before inviting 
frank discussion. 

The success of employee representation in the ad- 
ministration of welfare work is conditioned basically 
by the needs of the welfare program. Perhaps the 
chief advantage of employee representation here is 
the greater certainty it gives that the welfare facili- 
ties established will provide for genuine needs on the 
part of the employees and do so in ways that meet 
their approval. 

The objectives already mentioned are concerned 


Employee Representation To-day 325 


chiefly with rendering a working force a more har- 
monious and productive group. Through joint con- 
ferences, organizations have corrected employee 
grievances and unjust or discriminatory supervisory 
methods. Works councils have become essentially 
staff departments of the directing organization, for 
they have afforded executives counsel regarding pro- 
posed shop regulations, as well as regarding the labor 
policies that are in force. Employees, through works 
councils, have obtained information bearing upon the 
prospects of employment and earnings, as well as 
information concerning the work of branches of the 
business other than those in which they were engaged. 
In some cases, officials have broadened the scope of 
discussion to include marketing problems, in addition 
to matters of production technique, costs, and 
economies. In all of these respects the works council 
is a device to bring about better codperation between 
the individuals associated in a business, and therefore 
to improve the productive capacity and the earning 
power of the organization. 

The other phase of the labor relationship, namely, 
its aspect as a contract, has received more attention 
from the public than the productive phase to which 
reference has just been made. Perhaps this is due 
to the fact that labor controversies are better news 
than are the day-to-day productive relations between 
people in industry. It is clear that any plan which 
improves the relations between codperating individ- 
uals in business organizations tends to increase the 


326 Business and the Church 


commodity income of society and is beneficial to all 
economic classes or groups. On the other hand, when 
looking at the labor relationship primarily as a con- 
tract, and when thinking in terms of economic classes 
or income groups, one is likely to think largely in 
terms of the diverging interest of employers (buyers) 
and employees (sellers). 

With reference to its use as a means for negotiating 
wages, employee representation can be criticized, and 
sometimes with justice, as being less effective either 
for the employer or the employee than some other 
method of dealing. As contrasted with the individual 
relationship between employer and employee, a 
works-council plan undoubtedly tends to result in 
more favorable terms of employment for the wage- 
earner. It affords him spokesmen against whom the 
company has promised not to discriminate for action 
taken in good faith in their representative capacity. 
The plan in some companies is operated so that em- 
ployee representatives have the opportunity to in- 
vestigate terms of employment in other firms; thus 
a salutary degree of publicity is given to employment 
conditions and policies. The employer benefits from 
employee representation in having at hand repre- 
sentative machinery which will acquaint him with dis- 
satisfaction concerning terms of employment, and 
which will aid in correcting maladjustments in wage 
rates before bitterness and resentment have arisen. 

The chief criticism of employee representation has 
probably come from those who believe in collective 


EEE 


Employee Representation To-day 327 


labor negotiations and who think that the economic 
strength of the employee group is too narrow when 
that group consists only of workers employed by one 
company. ‘These critics hold that employees who 
work for different employers should be banded to- 
gether, and that thus a broad foundation is established 
which can support an aggressive movement for better 
terms in any plant or which can constitute a formid- 
able offensive and defensive alliance. 

It is impossible strictly to contrast the benefits to 
employees of unionism and employee representation 
because of the rapidly changing factors in the indus- 
trial situation and the further condition that each 
company, to a certain degree, is a law unto itself. 
Upon a hypothetical basis, and by ruling all other cir- 
cumstances out of account, the conclusion is easily 
arrived at that unionism confers more power upon 
the wage-earner than employee representation. 
Under real conditions, however, it may be found that 
the employer is antagonistic to labor-unions and that 
the employee in a labor-union meets much opposition 
and sustains costs of militant effort which may more 
than outweigh the gains which he is able to force by 
means of that effort. Wage-earners who work for 
employers willing to pay market rates of wages with- 
out coercion find that unionism has its costs, no less 
than its probable benefits. It must be pointed out 
that unionism has at times hindered employers in 
their application of improved methods, because the 
unions were concerned solely in advancing the imme- 


328 Business and the Church 


diate partizan interests of their members and in pro- 
tecting their members against this or that technical 
change which might render the supply of their labor 
less essential. In those instances not only the em- 
ployers affected but all the purchasers of their prod- 
ucts sustained an economic disadvantage. On the 
other hand, that employer who, because of predatory 
motives or helplessness under conditions of excessive 
competition, tries to undermine existing employment 
conditions, probably must be dealt with by militant 
union action. That action, to be effective, should be 
supported by employees in many competing estab- 
lishments. 

Reasons already exist which justify the forecast 
that both unionism and employee representation will 
borrow much from each other. Some labor-unions, 
hitherto concerned chiefly with general standards of 
employment—with terms of the labor contract as 
between shops—are participating, through shop com- 
mittees, in the productive phase of the labor relation- 
ship. This development is probably in its infancy, — 
and only a relatively few unions as yet have indorsed 
it in principle, much less adopted it in practice.* Em- 
ployee representatives under works-council plans, 
who have found their negotiating ability greatly in- 
ferior to that of the employer, have expressed dis- 
satisfaction to investigators in confidential interviews. 


‘Perhaps the outstanding example of union-management co- 
operation through shop committees exists on the Baltimore & Ohio 
Railroad. The experiment was begun in 1923. 


Employee Representation To-day 329 


The employer whose employees have that sentiment, 
and who wishes to retain the productive potentialities 
of employee representation, will probably recognize 
that they should have means of assuring themselves 
that the terms of employment negotiated in the works 
council are no less favorable than those effective else- 
where. 

At the present time, from the standpoint of the 
public, no one form of labor relationship is generally 
desirable or generally suitable. From that stand- 
point, it is well that experiments in this field go on 
and that the people in each business organization 
evolve the labor relationship which seems to them to 
suit their own needs best. Because of the rapidly 
widening horizon of wage-earners, it is unlikely that 
an employer will be able to impose any form of in- 
dustrial relationship upon them that is patently 
inimical to their interests. Since they have had expe- 
rience with the power of unionism, that tool is at hand 
should any other relationship become unsatisfactory 
to them. 

The public can observe with satisfaction that em- 
ployee representation has permitted wage-earners to 
have a voice in the making and operating of working 
rules, and that it has thus introduced a degree of self- 
government into modern industry. The interchange 
of views in works councils has more fully acquainted 
officials in all ranks with the feelings and the opinions 
of employees. Thus employee representation has 
cleared away misconceptions which often were the 


330 Business and the Church 


direct consequence of different backgrounds of expe- 
rience and different habits of thought. A condition 
of mutual understanding, together with the oppor- 
tunity afforded for explaining administrative orders, 
brought about in some organizations by employee 
representation, has enabled managerial staffs to run 
the plants in their charge with the approval of the 
employee. The former system, which offered the 
alternatives of implicit obedience or immediate dis- 
charge, has been supplanted in these establishments. 

Employee representation has had a wholesome 
educational effect in large business organizations. 
The employees’ ideas of the business in which they 
work have been made more complete, and in this way 
one of the principal disadvantages of large-scale pro- 
duction has been mitigated. Both employers and 
employees have seen that their respective interests 
are neither wholly mutual nor wholly opposed, and 
that understanding and tolerance on both sides are 
necessary to obtain greater satisfaction within such a 
complex relationship. 


THE ORGANIZED CHURCH AND 
ORGANIZED LABOR 


ARTHUR NASH 


Arthur Nash is the founder and president of the A. Nash 
Clothing Company, of Cincinnati, Ohio, with a business that has 
grown from a hundred thousand dollars to twelve millions a 
year in less than a decade. 

He is the son of an Indiana farmer, and was educated for the 
ministry of the Seventh Day Adventist Church. Forced out of 
the ministry because of his liberal beliefs and without a trade, 
he became a hod-carrier and laborer, and felt himself a religious 
outcast and atheist. 

After years of struggle he finally established a small busi- 
ness in Columbus, Ohio, only to have everything swept away by a 
flood, leaving him in debt. He began over again in Cincinnati, 
but the World War called his two sons into service and took 
most of his own time and energy. Declaring that the war was 
final proof that Christianity had failed, he undertook to prove 
it from the New ‘Testament, but instead convinced himself 
that Christianity had never been tried in society and industry. 

After the Armistice he purchased a small sweat-shop and 
called his twenty-nine workers together and told them that so 
long as he kept the shop in operation the Golden Rule would 
be its governing law, and to prove its sincerity he raised their 
wages from fifty to three hundred per cent. The business that 
had been stagnant and operating at a loss suddenly began to grow 
and show large profits. Refusing outside investment, the capital 
stock of the company has grown from sixty thousand to three 
millions through stock dividends and the investment of the 
workers. Recently he took the initiative in a movement that 
finally resulted in unionizing the shops. 

He also insists that industrial peace is the basis of world peace. 
“War,” he says, “never did come off the decks of battle-ships 
or out of the mouths of cannon, but out of the hearts of men.” 

He declares that the real religious conflict of our time is 
between sectarian Churchianity and vital Christianity. He and 
his fellow-workers have pledged a quarter of a million dollars 
to help develop boys’ clubs in Turkey as an expression of their, 
faith in universal brotherhood. 


: 
| 


THE ORGANIZED CHURCH AND 
ORGANIZED LABOR 


ArtHuR Nasu 


There was a man who had two sons. He went to the 
first and said, “My son, go and work in the vineyard to- 
day.” And he answered, “TI will, sir,” but he did not go. 
Then the man went to the second son, and told him the 
same thing. And he answered, “I will not!” But after- 
ward he changed his mind and went. Which of the two 
did what his father wanted? 

They said, ““The second one.” 

Jesus said to them, “I tell you, the tax collectors and 
prostitutes are going into the Kingdom of Heaven ahead 
of you.? 

“That, I tell you, is why the Kingdom of God will be 
taken away from you and given to a people that will pro- 
duce its proper fruit.” 


This most scathing denunciation was delivered in 
the Temple to the leaders of the organized church. 

Before going to the vital issues of our story, let 
us all definitely distinguish between the organized 
church of Judaism and real vital Judaism. Let us 
also distinguish between the organized church calling 
itself Christian, and real vital Christianity, because 


*Matthew 21:28-31, American translation by Goodspeed. 
333 


334 Business and the Church 


there is no difference between the spirit of true 
Judaism and true Christianity, nor between the or- 
ganized church of Judaism and the organized church 
of Christianity. 

Because of the fact that certain “priests and elders” 
and bishops are undoubtedly ready to say that I am 
not a recognized authority in the church, and raise the 
question, “What authority have you for doing as you 
do, and who gave you this authority?” I will perhaps 
be pardoned for saying that when I left theological 
school it was the boast of my teachers that I could 
replace the New Testament from memory if it were 
blotted out, and in my search after the truth I have 
been an earnest student of religion and religious 
teachings. However, I would not be misunderstood 
by any one. I ama churchman, and it is with a burn- 
ing desire to arouse my fellow-churchmen to produce 
the proper fruit of the kingdom of God that I am 
undertaking this task, and I believe all will agree 
with me that it was the same burning desire in the 
heart of the great Teacher of Galilee that caused him 
to give this most cutting illustration and denuncia- 
tion to the churchmen of his time. 

First of all, Jesus is not talking about a far-away 
future or mythical place when he uses the term 
“Kingdom of God.” He is talking about a social 
order that has been intrusted to the keeping of the 
leaders of the church, and He says to them, “That, 
I tell you, is why the Kingdom of God will be taken 
away from you and given to a people that will pro- 


Organized Church and Organized Labor 335 


duce its proper fruit.” The King James version 
reads: “Therefore say I unto you, the kingdom of 
God shall be taken from you, and given to a nation 
bringing forth the fruits thereof.” 

This kingdom of God is already in our possession, 
and the question of our retaining it depends upon our 
bringing forth its proper fruit, and the real question 
before us to-day is: are we doing this job; and if we 
are not doing it, is the other son doing the job? 

Let us look at this picture of the two sons for a 
moment. One of them, when asked to work in the 
vineyard and take care of the little vines, which are 
God’s children, said, “I will, sir,” but he did not. 
He proclaimed himself to be a dutiful and obedient 
son. He made the “profession of faith,” but he did 
nothing. When the other son was told the same 
thing, he answered, “I will not,” but he changed his 
mind and went about the job, and the conclusion is 
that he is the one that did what his father wanted. 

When we undertake to make a comparison between 
what the organized church has done to bring about 
a right social order and justice upon this earth, and 
compare it with what organized labor has done and is 
doing, we are made to blush for shame. 

Let us frankly lay aside all of our pietistical claims 
and look at the situation as it is. Has any one ever 
known, can we point to a single instance when the 
masses have been struggling for a mere pittance, 
when poverty and the diseases that go with it have 
been rampant, that the organized church has taken 


336 Business and the Church 


up the work and made the fight for justice and right- 
eousness in behalf of the poverty-stricken, toiling 
masses, or must we confess that in every instance this 
fight has been taken up by organized labor, and that 
the church, if it has had anything to say, has advised 
against doing anything that would interfere with in- 
dustry or property, and especially against any 
semblance of violence? I am frank to say that I find 
myself in deep sympathy with our brothers in Rus- 
sia, who have been forced to the conclusion that re- 
ligion is an opiate that endeavors to keep people 
content under injustice. Is not that exactly what 
the church did do in Russia? Is not that what the 
church in a large measure is doing in every other 
country? Does it not make your blood run cold 
when you stop to think of the conditions in the cloth- 
ing industry (the one that I happen to be engaged 
in) before organized labor undertook the struggle 
to free wage-slaves that were working in the sweat- 
shops of our own country? 

What did the church, the self-proclaimed dutiful 
son who said he would go work in the vineyard, do 
about it? 

In our own city of Cincinnati, when the mission- 
aries of organized labor came in 1919, and found the 
women workers, under the high costs of that year, 
working for an average wage of less than ten dollars 
a week, was the church doing anything about it? Did 
the church know anything about it? There can be 
only one answer; that is, that the church knew 


Organized Church and Organized Labor 337 


nothing, did nothing, was not even concerned; but 
the labor missionaries, when they came in, began to 
say in effect to these poor people, “You may just as 
well starve trying to get justice as to starve toiling at 
your machine.” When some of these feeble, non- 
resistant, church-doped poor souls pleaded for their 
children, they were told that their children might as 
well starve in the struggle for justice as to grow up 
without a chance in life. 

The great strikes in 1919 were called, and as these 
toiling paupers came out on our streets and sidewalks 
to picket the places where they were laboring, they 
were a most pitiful sight. They were only half 
clothed, although it was in the dead of winter. They 
stood about mutely, little understanding what they 
were trying to do. The police came along and or- 
dered them to move on, but the labor leaders told 
them to stand; then the police began to use force. 
Most of them were still mute and non-resistant, but 
the fire would occasionally rise in their blood and 
they would strike back. They were then loaded into 
the patrol and taken to the police station. Many of 
them were given terms in prison for violence, and 
bold head-lines blazed across our newspapers. 

What did the church do in this time? I talked 
with many of the ministers, heard many sermons 
preached about peace, and most of them deplored the 
fact that industry was being interfered with and that 
violence had been on the streets of our city, but not 
one connected with the organized church did I hear 


338 Business and the Church 


or know of raising his voice against the injustice 
that was back of this situation. 

I am aware that there are those who are ready 
to rush to the defense of the organized church and 
say that there are and have been ministers that have 
raised their voices and that the Federal Council of 
Churches has undertaken to enter this situation. With 
all of this I am thoroughly familiar, but I know 
that the ministers who have raised their voices have 
not been the recognized leaders of the church, that 
they have usually been chastised by the church, some 
of them most severely, and that the Federal Council 
of Churches, instead of having whole-hearted co- 
operation in the things that it has undertaken, has 
been severely criticized and has received little co- 
operation in its work from the organized church. 

In the period before the World War, during 
which I carefully-studied the attitude of the church, 
I had been a laboring man and belonged to a labor- 
union under the old Knights of Labor. Immediately 
after the World War I bought a little clothing fac- 
tory, a literal sweat-shop. I was so discouraged with 
the attitude of both the labor-unions and the church 
that I decided that regardless of either I would try to 
live by the law of God governing human relation- 
ships which we have come to know as the Golden 
Rule. 

I spoke no word of condemnation either for the 
organized church or for organized labor. I carefully 


Organized Church and Organized Labor 339 


studied the attitude of both. This led me first to the 
great wage raises, ranging from 50 to 300 per cent, 
the next day after I bought this little sweat-shop. 
I soon discovered that we were making real profits 
in the business, because of the hearty response and 
codperation of the workers when I told them that 
we were going to make brotherhood and the king- 
dom of God a reality in our place, regardless of 
profits to the company, and backed it up by the 
tangible evidence of the great wage raises we imme- 
diately put in force. 

When we discovered these profits and began to 
consider what we should do with them if we wanted 
to be righteous and just, we went to the idea of 
profit-sharing, which we discarded in about a year. 
Then the idea of codwnership of the plant by the 
workers themselves was undertaken. This failed, 
largely perhaps because a great majority of our 
workers are women, and it is not their intention to 
spend their entire life in a clothing factory. They 
hope to use it only as a stepping-stone; hence a great 
many of them were not interested in owning the stock 
of the company. 

We then put into effect real democratic control, 
where all question of vital importance were voted on 
in large mass-meetings of all of the workers. These 
meetings were dubbed by certain great teachers as 
“town meetings.” 

Our business continued to grow until it had passed 


340 Business and the Church 


from the status of the smallest made-to-measure in- 
dustry in the country to that of the largest in the 
world. 

When we found ourselves with thousands of 
workers instead of the original twenty-nine that were 
in the little shop when we bought it, we began to 
realize that many weak places existed in our efforts 
to do justice to all men, and as we began to cast 
about for some one who was willing to undertake the 
job of literally and actively looking after the in- 
terests of the working people, again I ask, as I blush 
with shame, did we find it in the organized church? 
We did not. We found many who were ready to ad- 
vise with us, most of them saying that we could not 
deal with organized labor because it was class-con- 
scious and very often pagan, and did not pretend to 
work in the father’s vineyard. 

After carefully and prayerfully studying this ques- 
tion from every angle, we decided that no one could 
take over the interests of the laboring group and look 
after each individual efficiently and see that his in- 
terests were safeguarded, as the interests of every one 
must be if we are “to bring forth proper fruit for the 
kingdom of God.” We repeat, no one could do this 
job unless he was class-conscious, because in under- 
taking it he had to deal with and contend with all of 
the obstacles that a class-conscious, avaricious, or- 
ganized capitalistic group could bring to bear upon 
them. 

When this became clear to us, there was nothing 


Organized Church and Organized Labor 341 


for us to do, if we were honest, except to turn over 
the interests of the workers to organized labor, 
which, in spite of the fact that it makes no profession 
of working in God’s vineyard, does go out and take 
care of the little vines and bring forth fruit for the 
kingdom. 

The church has missed its calling. It is not feed- 
ing the lambs or clothing the naked. It is not 
“loosening the bands of wickedness and letting the 
oppressed go free,” as it should. 

I would call attention to the fact that Jesus did not 
say that the picture He drew of the two sons was 
ideal in every respect. There is no question that the 
ideal thing would have been for both sons to say to 
the father, “We will go and work in the vineyard, 
and we will bring forth the proper fruits of the king- 
dom,” and then go and work at the job. Never- 
theless, the one that refused to proclaim himself to 
be a dutiful son and yet finally did the job is justified 
ahead of the one that loudly proclaimed himself an 
obedient son, made a great profession of obeying the 
father, and yet did nothing. May I repeat that the 
first son gave the correct answer in words, but the 
second son gave the correct answer in deeds, and the 
deeds are better than the words, but what the great 
Father would have is that both sons should say, “I 
will, sir,” and then go and do the job. What must 
be the opinion of the man who said he would not go, 
when he sees the son who said he would go not 
being loyal and true to his promise? 


342 Business and the Church 


Any one desiring the answer to this question has 
only to get the response of organized labor when it is 
appealed to in behalf of the church, and I humbly 
and with shame confess as a churchman that the 
church is to blame because it did not keep its word to 
the great Father. 

The question may now arise, what would I have 
the church todo? I can only answer in one way, and 
that is that seeing this situation as it is, I could only 
find one conscientious answer, and that was to say 
to organized labor: “We will turn over all of the 
problems of our workers to you. You have studied 
this situation. You have been the son that has 
worked in this vineyard, and we will be obedient to 
your commands.” 

I wish that my voice might ring out around the 
world when I say to my brother churchmen that our 
great opportunity is now here, and if we—I mean 
by this every church publishing house and church in- 
stitution—will turn to this other son and say that 
we have a job to be done for the toiling masses, and 
you are the students of their problems, and we are 
willing to be obedient to your commands in dealing 
with our workers; then we can set about the job of 
getting across to them the great spiritual side of the 
work of the kingdom. In other words we come into_ 
harmony with this other son, and then we bring the 
message of the right answer to the Father in both 
words and actions. We will then restore the lost 


Organized Church and Organized Labor 343 


confidence of the other son, who will cease to regard 
us as hypocrites who promise but do nothing. 

~ I am fully aware of all of the usual arguments 
that organized labor not only raises wages but lowers 
production, that it will not codperate with capital, and 
that it resorts to violence and so on. We are being 
asked on every hand, “How is it working in your 
plant?” I want to say with deep humility that so far 
as I know this is the first time that a large industrial 
corporation has whole-heartedly turned over all of 
the problems of its workers to organized labor and 
entered enthusiastically into a codperative movement 
for the good, not only of our own workers, but of the 
toiling masses everywhere; and in answer to the 
above arguments I want to ask how any organization 
that must fight to get a foothold in an industry and 
then continually fight to keep that foothold can be 
expected whole-heartedly to codperate with the 
owners of the industry? It is too absurd even to 
think about, much less argue about. Again when it is 
analyzed the blame seems to me to lie clearly at the 
door of the organized church. 

I am frank to confess that when our industry had 
grown until there were thousands of workers we had 
individually lost track of them. It was not possible 
for us to know them all personally and attend to our 
other duties, and for a long time we had hoped that 
everything was all right, but somehow sensed the fact 
that we were drifting, that we were a ship without a 


344 Business and the Church 


rudder. We knew there were matters that needed 
adjusting in our business. The labor organization 
has found them, but we are astounded to know that 
they found as few as they did. They are entering 
whole-heartedly into their job and are doing it 
thoroughly and fearlessly, and although much of it 
is not pleasant to them. Many of our workers are 
still studying and analyzing every angle of what is 
going on, but they are coming to see that the world is 
larger than our own industry, however large it may 
be, and that we have now cast our lot with the 
group—the son that has gone about the job of work- 
ing in the father’s vineyard—and our call to the 
church is the call that the Master gave so often, “Go 
work to-day in my vineyard.” 

This is a real concrete job of bringing forth the 
fruits of the kingdom of God which has been com- 
mitted to us, and if we fail, the “kingdom of God 
will be taken away from us and given to a people that 
will produce its proper fruit.” 


WHAT FACTS SHOULD THE CHURCH 
KNOW ABOUT INDUSTRY? 


EARL DEAN HOWARD 
of 
Hart, SCHAFFNER AND Marx 


Mr. Howard has been labor manager for Hart, Schaffner and 
Marx since 1911 and has participated in the working out of the 
labor agreement and plan of industrial relations which is now 
used not only in Hart, Schaffner and Marx but in most of the 
clothing markets in the country. He is also on the faculty of 
Northwestern University, giving courses in industrial relations. 

During the year 1918 Mr. Howard served as executive secre- 
tary on the commission of industrial relations of the United 
States Chamber of Commerce in Washington. In this capacity 
he represented the chamber in its codperation with the agencies 
in this field. 

Mr. Howard’s interest in the relationship between the churches 
and industrial relations comes about through his membership on 
the social-service commission of the Federal Council of Churches. 


WHAT FACTS SHOULD THE CHURCH 
KNOW ABOUT INDUSTRY? 


Eart Dean Howarp 


The question, What facts should the church know 
about industry? presupposes an answer to another 
question very controversial and searching: Is Chris- 
tianity a religion of social amelioration? 

Some years ago when interested in the affairs of 
the Federal Council of Churches, I devised a test or 
rating scale by which one might classify religious 
people on this point. Here it is: 


Ratinc SCALE FOR CHRISTIANS 


How far and in what manner should the church at- 
tempt to influence men in their economic relations? 

Different points of view from extreme conservative to 
extreme radicalism; choose the position which you would be 
willing to defend with the greatest conviction: 

(a) The church should limit itself to the personal rela- 
tion of the individual to God and not concern itself with 
social relations or ethics. 

(b) The church is responsible for the consciences of its 
members. If the conscience of the individual functions 
efficiently, his conduct will be socially desirable, so that the 
church need have no direct responsibility therefor. 

(c) The church has further responsibility beyond stimu- 

347 


348 Business and the Church 


lating the conscience to guide the conduct of man. Con- 
science must be enlightened and educated so that men will 
recognize and perform social duties. The church should 
develop the social conscience in the individual but should not 
attempt to formulate moral judgments in specific cases. 

(d) The church should provide moral leadership in 
society, on the ground that it is the duty of the church to 
strive to make righteousness prevail in all the relations of 
life. Righteousness under modern economic conditions is a 
matter of right collective thought and action; the individual 
conscience even though completely dominant and enlight- 
ened is inadequate to guide conduct. ‘There is needed a 
collective social conscience to determine what social right- 
eousness is and how it shall be attained. 

(e) The church should insist upon the complete appli- 
cation of Christian principles throughout all social and eco- 
nomic arrangements, and strive to create a kingdom of 
heaven in which spiritual interests shall be paramount, and 
the will of God prevail over every individual interest. The 
social and economic system should be changed so as to secure 
the maximum of opportunity for spiritual development, and 
material prosperity as incidental and subordinate. ‘The 
church should formulate moral judgments on specific mat- 
ters, such as the eight-hour day, collective bargaining, etc. 

(f) The church should oppose the capitalistic system, 
with its private property in the productive resources and 
its wage system, as contrary to the principles enunciated by 
Christ. Pacifism should replace war, conflict, and compe- 
tition. Self-will should abdicate as a governor of human 
conduct in favor of the will of God as interpreted by the 
collective state. The government of men should be a pure 
democracy and should govern all of the relations of men. 


What Facts Should the Church Know? 349 


Doubtless a large part, perhaps a majority, of ac- 
tive church-members would incline to the fundamen- 
talist position that all scientific study were vain and 
futile. To know the Bible and to follow its more or 
less plain instructions as to conduct is quite sufficient. 
Of course, in business and political affairs, which in 
practice, if not theoretically, are held to be something 
quite apart from religion, knowledge of industrial 
facts may be valuable, although people of this type 
are habitually distrustful of experts and scientists. 

At the furthest extreme from the fundamentalist 
stands the person who thinks religions consist in right 
conduct and right relationships among men. Such a 
one is ceaselessly busy in every reform and better- 
ment movement; he is eager to realize the kingdom 
of heaven upon earth. He feels a godlike responsi- 
bility for the state of the world and blames himself 
for the persistence of evil. His favorite hymn 1s 
“Onward, Christian Soldiers.” His church is an in- 
stitution for social service, and he believes that busi- 
ness and politics should be Christianized with the aid 
of science. His pulpit would be a forum for political 
and economic discussion. 

Between these two extreme positions we find a 
large class of educated people perplexed by the neces- 
sity of maintaining a double standard of conduct, one 
standard for business relationships and a quite dif- 
ferent and conflicting one for other relations. Each 
one feels vaguely that he has no right to call himself 
a Christian unless he applies the clear and unmistak- 


350 Business and the Church 


able Christian principles to all his thoughts and 
actions in all relations of life. To say to such a man, 
who is a hater of hypocrisy and an earnest striver for 
personal integrity, that the Christian principles are 
not applicable in modern industrialism, is equivalent 
to declaring Christianity meaningless and sending 
him in search of a more practical religion. 

Just so far as people demand of their moral and 
religious leaders a doctrine which shall be a lamp 
unto their feet, those leaders must either be prepared 
to deliver the goods or lose their leadership to others 
who will give better satisfaction. Wherever the 
people are content to regard religion as a matter of 
insurance against possible risks or fire hazards in a 
world to come or as a matter of emotional release 
from the hard facts of life, the church may ignore 
the social sciences. 

Assuming, then, a community of people genuinely 
desirous of leading Christian lives, even in their busi- 
ness affairs, and a minister with a feeling of respon- 
sibility for his leadership and a belief in the practica- 
bility of religion, what knowledge is necessary to him 
that he may function intelligently and successfully? 

Industry is the name we apply to that vast organ- 
ization of men and things by which men sustain their 
physical lives and create a material environment and 
condition most favorable to a good life so far as their 
intelligence conceives and is able to realize it. 
Through his instincts, appetites, fears, and ambitions 
man is driven by the life-force to participate in the 


What Facts Should the Church Know? 351 


industrial life of his community; if he should choose 
to ignore such participation, even to live a completely 
spiritual life, he would be a suicide so far as physical 
existence is concerned. Just so far then as the indi- 
vidual elects to participate in industrial life, he must 
know the rules of the game, the conditions and regu- 
lations which determine success or failure. 

Unfortunately the rules for success in the indus- 
trial game are often quite inconsistent, even contra- 
dictory, with those spiritual laws which the church 
teaches as essential to a religious life. Worse still, 
as civilization brings more and more industrialism, 
the individual becomes more and more helpless and 
dependent upon the system and less free to choose 
his own line of conduct. 

Business is the term by which we designate the 
mode by which industry is carried on. Russia is try- 
ing another, the political mode, of governing indus- 
try. The essential elements of the business mode is 
the free organization of industry by private enter- 
prise, the toleration and encouragement of competi- 
tion even to the point of destructive warfare, and reli- 
ance upon the law of survival of the fittest to secure 
efficiency. Government exerts its utmost power to 
protect property rights and enforce contracts, and 
beyond that, in theory at least, leaves industry to be 
regulated by economic law. 

The central fact of life is organization. The same 
principles seem to apply both to biologic and to eco- 
nomic organization. In each we see the life-force 


352 Business and the Church 


operating to develop even larger and more compli- 
cated structures, at once more efficient and more vul- 
nerable. In industry, this life-force manifests itself 
as the acquisitive instinct of the persons involved in 
the business organization. This acquisitive instinct 
is the law of self-preservation and aggrandizement 
adapted to the business mode of industry. 

If we agree that the central idea of Christianity is 
unselfishness and altruism, the very opposite of ac- 
quisitiveness, we can appreciate the fundamental con- 
flict between business and religion. It is impossible 
to reconcile the economic and the spiritual interests, 
neither can we give up one for the other; the only 
alternative is compromise. 

There are many methods of compromise. The 
simplest is probably the Rockefeller method of a 
complete separation of interests, a dual life. Out- 
side of business activities, Christian principles govern, 
especially in relation to church affairs. Inside the 
business office, however, the churchman Jekyll be- 
comes the captain of industry and master financier 
Hyde. The game of business is played with the 
same cold unscrupulousness, the same ruthless disre- 
gard of the interests of the other players and the 
same single-minded devotion to success that character- 
izes the professional poker-player. A simple method 
but not easy for most people, since nature does not 
produce many Dr. Jekylls and Mr. Hydes, dual per- 
sonalities are rare, and the instinct of integrity, of con- 
sistency in character is quite general. 


What Facts Should the Church Know? 353 


Since it is almost impossible to abandon business 
altogether, another method is to abandon spiritual in- 
terests and frankly adopt the materialist philosophy 
without cant or hypocricy, as Jay Gould did. This 
saves integrity, and we cannot utterly despise a man 
or a beast whose actions are consistent with his prin- 
ciples. How shall we estimate the number of people 
who value their integrity so highly that they will 
throw over religion entirely in order to keep it? Per- 
haps there are more devil’s advocates, like Shaw’s 
hero in The Devils Disciple, than we know of. 

The last alternative left is the difficult one of 
reconciling the irreconcilable, of mixing together oil 
and water, of Christianizing business. Is it possible 
to play good poker in the spirit of generosity? Or 
can the rules of the game be changed so that the in- 
consistency can be overcome? 

If it is the purpose of the church and its ministers 
to make righteousness prevail in business as in all 
other relationships, obviously it must first be quite 
clear in its own mind as to how this desirable condi- 
tion can be brought about. In the absence of divine 
revelations 2 Ja Moses and Joseph Smith, it must fall 
back on scientific research and discover right methods 
by searching out and applying the laws of cause and ~ 
effect. 

In the first place come the laws of human nature. 
All human actions and all human relationships pro- 
duced thereby flow almost automatically from atti- 
tudes of mind, particularly from desires and beliefs 


354 Business and the Church 


as to the relative importance of things. Business men 
act as they do, and thus bring about the conditions 
as they exist, because they believe, in their wisdom or 
ignorance, that such behavior will promote their 
good. If the church would influence behavior and 
conditions, it must change or alter the beliefs of men 
as to their own good. Granted that the church 
already knows what is good for men, clearly its 
function is to educate the minds of men, not by 
propaganda, authority, or undue influence, but by 
scientific demonstration. 

In the second place come the laws of business, the 
necessary connection between cause and effect in busi- 
ness affairs. Perhaps we have been too hasty in as- 
suming the incompatibility between business and 
Christianity. There may be something in acquisi- 
tiveness, as in the pursuit of happiness, which tends to 
defeat itself. Nobody can read Henry Ford’s My 
Life and Work or Edward A. Filene’s The Way Out 
without wondering how far we dare go in hoping for 
a code of business principles compatible with decent 
human relations yet sound business. 

Of tremendous importance is this fact: business is 
a means and not an end. This signifies that business 
derives its importance only from the contribution it 
makes to the end it serves. Wherever we find that 
its contribution is much less than has been assumed, or 
wherever we find that the end itself is less worthy 
than had been thought, there is a chance to look for 
good reasons to justify more Christian conduct. The 


What Facts Should the Church Know? 355 


poor and ambitious young man may properly attach 
great importance to business success as an element in 
a successful career, but if he does not revalue his ob- 
jectives as he grows older and richer he is likely to 
discover that in his later years his activities have been 
guided, not by any real interest, but simply by be- 
liefs which have lost most of their validity with 
changing circumstances. Perhaps the greatest oppor- 
tunity of the church lies in revealing to habit-blinded 
business men that a revaluation of their interests is 
long overdue and that such a revaluation may lead to 
behavior more Christian and less acquisitive. 

Instead of being rigid and inexorable, the laws of 
business may be found to be very flexible, varying 
with circumstances. For example, the formidable 
power of the Amalgamated Clothing Workers of 
America in the men’s clothing industry have revolu- 
tionized the rules for success in that business. Where 
it was once profitable and good business practice to 
cut wages and piece-rates, to lengthen working hours, 
to discourage complaints, and, in general, to operate 
on the standard set by the greediest contractor, it is 
so no longer; indeed, such a policy would be ruinous. 
The Jewish gentlemen who still manage this industry 
are quite as acquisitive as ever they were, and the 
more “Christian” character of their behavior is en- 
tirely due to a change in the rules of the game. It 
would, however, be quite unsafe to assume from this 
one example that unionization will always lead to 
more personal righteousness in business practices. 


356 Business and the Church 


One of the great dangers of the church is the half- 
truth which is more false than error itself. 

At least three suggestions have been offered here 
as to what kind of facts are useful to the person in- 
terested in Christianizing business: (1) knowledge 
of the laws of human nature, (2) knowledge of the 
laws and facts of business, and (3) possibilities of the 
revaluation of interests. If any impression has been 
made upon the mind of such a person, the question 
naturally arises: how shall I acquire these useful 
facts? 

The source of knowledge is experience, either our 
own or that of somebody else. Before contact with 
facts and ideas can produce knowledge, they must be 
filtered through the mind. 

Thus both experience and a mind capable of ex- 
tracting essential wisdom from experience are neces- 
sary. Experience wrongly interpreted leads to er- 
roneous principles and standards of judgment. 

It is the business of the social sciences to aid in 
forming correct judgments from facts. The com- 
monest cause of bad judgment in these matters is 
wrong mental habits, prejudice, enthusiasm, sym- 
pathy, and whatever else interferes with clear scien- 
tific perception of the relation between cause and 
effect in social matters. 


WHAT THE CHURCH EXPECTS OF 
THE BUSINESS MAN 


JEROME DAVIS 


Jerome Davis was born in Japan of American parents. His 
father, after having a share in freeing the slaves as a colonel 
in the Civil War, helped to found the largest Christian uni- 
versity in Japan, Doshisha. His mother, Frances Hooper Davis, 
traced her ancestry back through a governor of Massachusetts 
to a signer of the Declaration of Independence. 

In spite of the handicap of a foreign schooling, Jerome Davis 
finished his college course in three years at Oberlin. For a short 
time he worked with the Minneapolis Civic and Commerce 
Association and then began his training for the ministry. Dur- 
ing the summer he toured Labrador and Newfoundland with 
Sir Wilfred Grenfell in the hospital ship Strathcona, 

For three years during the war, Mr. Davis was in Russia, 
first in charge of 150,000 prisoners in Turkestan, and later in 
charge of the Y.M.C.A. war work. At the end of the world 
conflict he returned to America, speaking widely against Russian 
intervention. 

On concluding his course at Union Theological Seminary he 
was awarded the Gilder Fellowship at Columbia University 
and thus had the opportunity to secure his Ph.D. In 1921 he 
again visited Russia on an emergency relief mission, returning 
in the autumn to take up his duties at Dartmouth as assistant pro- 
fessor of sociology. In 1923 he made an investigation into the 
human side of mining conditions in West Virginia for a report 
which was presented to the Federal Coal Commission. In 1924 
he was appointed head of the Social Service Department at Yale 
University. In 1926 he accepted the task of making an in- 
vestigation into the social and economic conditions in Russia. 

Mr. Davis is the author of The Russians and Ruthenians in 
America, The Russian Immigrant, In Introduction to Soci- 
ology, as well as editor of the Social Relations Series published 
by D. C. Heath & Company and contributing editor of Social 
Forces. 


WHAT THE CHURCH EXPECTS OF THE 
BUSINESS MAN * 


Jerome Davis 


The recent coal strike in England, according to the 
Conservative Premier Baldwin, “threatened the basis 
of ordered government and came nearer to proclaim- 
ing civil war than we have been for centuries past”; 
and in fact it was a class conflict unparalleled in the 
annals of history. Should we not be warned of the 
terrible impasse to which we may come unless scien- 
tific knowledge and technical equipment are placed at 
the service of all, with special unearned profit to 
none? Nor is England the only example. The 
average American is becoming painfully aware of 
serious flaws in our own industrial mechanism. Some- 
thing is wrong with the lubricator. Whenever we 
attempt a gear-shift, the engine stalls. In the trans- 
fer from a war to a peace basis, strike succeeds strike, 
and class warfare, even a Herrin massacre, occurs. 
Almost every basic industry suffers—coal, railroads, 
and—but yesterday—steel. A scientific and impar- 
tial analysis seems to indicate a structural defect. 
Some would have us believe that the iron man of in- 


+The writer makes no pretense of representing or interpreting 
the mind of the church as a whole; he speaks merely as a single 
individual within the church—a fact which should be remembered 
throughout this study. 


359 


360 Business and the Church 


dustry, our own creation, threatens to become our 
master. The church cannot stand still in all these 
crises, nor can we drift comfortably and compla- 
cently in a direction which will inevitably lead to 
disaster; we must reconstruct the foundations of our 
structure before the hurricane is upon us. How far 
can the church safely go, and what has she a right 
to expect of business men in a normal period before 
the storm? 

It is first necessary to make absolutely clear what 
the church does ot expect of Christian business men. 


It does not assume the autocratic task of dictating 


just how a particular business shall be conducted nor 
insist that industry shall be run according to an inter- 
pretation of the Golden Rule necessarily spelling 
financial failure. The church does not attempt to set 
itself up as an infallible authority on all the ethical 
problems of commerce and finance; it does not claim 
itself technically competent to censure all the acts 
and policies of an individual firm. Much less does it 
demand that all the profits of business shall be 
turned into the treasury of the church. It is seeking 
something very much higher, more difficult, and 
more fundamental than any of these things. 

The church expects business men who are profess- 
ing Christians to make a sincere attempt to square 
their daily-conduct pattern with the ethical teachings 
of Jesus and with the spirit of His life. It is plati- 
tudinous to say that no man can bé sure that he is 
practising what he knows nothing about; yet many 


———— 


What the Church Expects 361 


modern Americans could not give a single precept 
laid down in the Epistle of James, much less state 
clearly the fundamental social principles of Jesus. 


One function of the church is to teach us some of *’ 


these facts; another, to interpret just what is in- 
volved in praying, “Thy kingdom come,” and what it 
means really to want God’s will done on earth as it 


is in heaven. It is the task of the church to help the # 


business man to see that this necessitates running the 
business first of all for the good of the consumer, 
second for that of the producer, third for that of the 
investor, and last of all for the good of himself. In 
the long run there is not so much difference between 
these separate interests as as first might be imagined. 
Sincere men may differ regarding the priority of the 
claims of the different parties to industry, but de- 
voted Christians can hardly deny that discipleship 
means the subordination of self... Indeed, it takes a 
relatively slight acquaintance with the life of Jesus 
to realize that He did not say, “Seek ye first the 
kingdom of profits,” but, “Seek ye first the kingdom 
of God.” How far the modern business world has de- 
parted from this concept, each reader can judge for 
himself. Again, Jesus taught his followers definitely 
that they must serve the group. ‘He that would be 
greatest among you shall be the servant of all.” 
These were no abstract theories; they were the stuff 
of which life itself was to be built. Jesus Himself 
lived this principle by sharing with His followers 
every material thing He had, and even on one occa- 


362 Business and the Church 


sion taking upon Himself the task of washing His 
followers’ feet. 

One of our greatest difficulties is that we are quite 
ready to acknowledge the glittering general prin- 
ciple but quite unwilling to practise it, however vo- 
ciferous our profession. ‘Theodore Roosevelt dis- 
covered this when he tried to enforce certain laws 
and made the significant comment: “A right is value- 
less unless reduced from the abstract to the concrete. 
This sounds like a truism. So far from being such, 
the effort practically to apply it was almost revolu- 
tionary, and gave rise to the bitterest denunciation 
of us by all the big lawyers, and all the big news- 
paper editors, who, whether sincerely or for hire, 
gave expression to the views of the privileged 
classes.” 

Now, running a business for the benefit of the con- 
sumer means not only that he shall be satisfied with 
what he receives but that no more profit is exacted 
from him than is necessary to make the service the 
best possible in the long run. In other words, service 
to the consumer demands not only good quality but 
the lowering of prices to the furthest point possible 
consistent with providing what is wanted. To state 
the matter in another way, reward should be pro- 
portional to service rendered; although the ambiguity 
of this statement is apparent, since it is relatively easy 
to persuade one’s self of the social value of any task. 
Every one should be able to realize, however, that 
no service is being rendered in the case of com- 


What the Church Expects 363 


modities which are socially questionable—a stan- 
dard which at once precludes most of the profits in 
land and stock speculation, as well as injurious or 
shoddy goods. 

Service to the worker means nothing less than 
according him precisely the treatment one would give 
to one’s own wife or children, provided they were 
in a similar condition and had to accept similar em- 
ployment. As Mr. Rowntree, the English manu- 
facturer, once said, “As a follower of Jesus, I cannot 
go to sleep in comfort at night until I know that 
conditions in my plant are such that I should be glad 
to see any one of my children take any position as a 
laborer in the plant.” How many of us can truth- 
fully say we are doing this? Now the church needs 
to call the attention of men to this ideal in no uncer- 
tain terms. Sometimes only a stinging rebuke is the 
most effective method of making men think; at other 
times more can be accomplished by a discussional 
fellowship; but no mere platitudinous generalities © 
will solve the situation. President Rowntree trans- 
lates this principle into the following “minimum con- 
ditions which any satisfactory scheme of industry 
must provide”: 


(1) Earnings sufficient to maintain a reasonable standard 
of comfort. 

(2) Reasonable hours of work (probably eight). 

(3) Reasonable economic security during the whole 
working life and in old age. 


364 Business and the Church 


(4) A reasonable share, with the employer, in determin- 
ing the conditions of work. 

(5) An interest in the prosperity of the industry in 
which he is engaged. 


To these might perhaps be added: 


(6) An equal chance for promotion. 
(7) Participation in the control of the business. 


At the present time employees do not have these 
rights in a large number of industrial concerns. In 
fact, they are often prevented from securing a rea- 
sonable share in the financial returns. Not so long 
ago, a shoe company introduced a new kind of ma- 
chinery which subjected the worker to a much greater 
degree of physical and mental strain. In the next 
two years the profits were so enormous that they 
equaled the total capitalized stock of the company, 
yet not a single cent found its way into the pay- 
envelope of the worker. No doubt the president of 
the corporation thought himself a Christian, but he 
needed a vigorous reminder from the church of what 
the Christ way involved in his business. It is some- 
times thought strange that labor and capital, partners 
in a common enterprise, do not act as such. The rea- 
son is that they really can hardly be said to be part- 
ners in any true sense. Partnership involves, among 
other things, a knowledge of the business, including 
its financial secrets, a share in the profits, and a voice 
in the management. Labor feels it is not being 


What the Church Expects 365 


treated as a partner and consequently does not always 
act as one. 

Above all else, the Christian employer should 
stand like a rock for the supremacy of human values 
over property values.. It is reported that Jesus once 
gave a practical application of this principle by free- 
ing a single human personality from demoniac pos- 
session and transferring the devils into a herd of 
valuable swine, so that they were all lost. The busi- 
ness men of that day—strangely akin to some in our 
own time—were much more impressed with the lost 
property than with the saved life and besought the 
Master to leave the district. At another time Jesus 
asked the question: “How much then is a man of 
more value than a sheep?” ‘There have been times 
when this simple teaching of the Master has been 
forgotten, and it is the duty of the minister to keep 
reminding us of it. President Roosevelt used to cite 
many instances of this failure, which to-day are sufhi- 
ciently ancient so that they will not arouse the emo- 
tional prejudices and rationalizations which any one 
of a hundred more recent examples might precip1- 
tate. Inthe coal strike of 1902 he was forced to take 
action because “the big coal operators,” although 
“they knew that the suffering among the miners was 
great” . . . “were prepared to sacrifice everything 
and see civil war in the country rather than back down 
and acquiesce in the appointment of a representative 
of labor.” He says that the coal operators were 


2 Theodore Roosevelt, An Autobiography, pp. 465-468. 


366 Business and the Church 


blind regarding “the rights of the worker to a living 
wage, to reasonable hours of labor, to decent work- 
ing and living conditions, to freedom of thought and 
speech and industrial representation—in short, to a 
measure of industrial democracy.” There are many 
business interests to-day similarly deaf and dumb 
to the implications of the religion they have formally 
accepted, and it is the task of the church to awaken 
them, not in the abstract, but in the concrete. 

Not only does the church expect the average busi- 
ness man to apply his Christianity in the concrete de- 
tails of the working day, but it expects him to wel- 
come and not block honest investigations into the 
truth about the industrial conditions in his own.plant. 
This would not mean that he must let every Tom, 
Dick, and Harry make independent investigations of 
his factory, but it should mean that he would welcome 
an occasional labor audit. The necessity for some 
such device should be apparent to every thinking 
Christian. 

As long ago as the Civil War, Lincoln declared 
“Labor is superior to capital and deserves much the 
higher consideration.” Doubtless the modern world 
is slowly beginning to comprehend that “humanics” 
plays as great a part as mechanics in business, but how 
do we know what the principle involves? Labor may 
condemn certain captains of industry or their lieu- 
tenants, the managers of corporate enterprise, for 
violating the standards. The business men deny the 
charges. Let us grant at once the great difficulty in- 


What the Church Expects 367 


volved in ascertaining the actual truth, but is it im- 
possible? 

In the early days of corporation finance there were 
similar complaints brought by stockholders against 
business executives. In the absence of the facts, 
financial disaster was frequent. Finally, as a check 
on management, an annual financial audit was inaug- 
urated. This was found to be so successful in pre- 
venting fraud that it has been continued down to the 
present time. Why is it not possible to inaugurate 
an annual human audit of industry? Would this not 
help to safeguard all the parties to industry—labor, 
management, capital, and the public? It surely must 
be possible to draw up some human standards which 
will meet with quite general acceptance. Whether 
or not each individual employer would agree with 
the principles does not greatly matter, for the human 
audit would merely ascertain scientifically the actual 
conditions in the concern investigated as compared 
with the standard. If an executive later desired to 
attempt to justify himself with the public, it would 
be his privilege. Such general standards were drawn 
up and adopted by the War Labor Board during the 
war. Since then they have been urged on the country 
by a host of economic and political leaders, from W. 
Jett Lauck and Senator Kenyon to President Wil- 
son’s Industrial Conference. It seems probable that 
such a code would attempt to cover wages, hours, 
security against accident, unemployment and old age, 
profit-sharing and labor representation. 


368 Business and the Church 


These principles would, of course, be further sub- 1 


divided in the actual audit. Thus the first item 
would include, among others, housing, clothing, food, 
and recreation. The results would not merely be a 
check on the management, but also on labor. It 
might demonstrate that their income was adequate 
provided it was wisely consumed. In other words, 
it might have a wholesome effect in educating the 
workers both in their wants and in their expendi- 
tures, which is another outstanding need of our time. 

Most fair-minded executives declare their sincere 
desire to meet the above requirements to-day; in 
fact, they usually feel that their employees are 
already being adequately cared for. This feeling, 
however, may be the result of mere opinion, bias, or 
the report of subordinates. The actual facts are 
usually unknown. In the absence of an impartial 
report, the employer, the worker, and the public may 
all be deceived. Sooner or later, asa result of griev- 
ances real or fancied, the public is suddenly startled 
to hear that a strike has been called. We have already 
seen that ever since the beginnings of the corporate 
era the financial audit has been a genuine safeguard 
to stockholders and the public. Why cannot the 
human audit of industry play as important a role in 
allaying the suspicions, the fears, and the difficulties 
of capital and labor? 

At present we have chartered public accountants 
who make financial audits. Why not have chartered 
public economists and sociologists who would make 


What the Church Expects 369 


the human audit? To-day the costs of an audit are 
borne by the company investigated. This would hold 
true equally for the annual human audit which de- 
termines the actual facts regarding wages, hours, se- 
curity, profit-sharing, and status of the workers. Such 
a report would naturally be submitted first to the 
company concerned. Later it would presumably be 
published. If an individual employer refused to pay 
for an audit, labor itself might conceivably step in 
and have it done. The public would sooner or later 
come to expect this just as it now does the financial 
audit. The social effect would be almost incalcu- 
lable. How does the public now regard a concern 
that is known never to have an audit? What would 
it think of one that refused to permit a human audit? 
In the case of interstate corporations, the government 
might well make such an audit compulsory. It is 
quite conceivable that this would do more than all the 
welfare schemes yet devised to usher in peace and 
codperation between capital and labor. 

The plan would seem to be building on our past 
experience and to be eminently practicable. At any 
rate, state governments are already enforcing an 
audit or inspection for many things. One of the 
most common examples is the investigation of safety 
appliances in factories. If it can be done for one 
item, is it not reasonable to suppose that it can be 
done for all? 

Whether or not the Christian employer agrees with 
the principle of the labor audit, the spirit of Chris- 


370 Business and the Church 


tianity would seem to leave him scant room for 
vigorous objections to a competent commission from 
the churches making some such investigation. When 
once the employer has permitted its establishment, 
he is hardly on safe ethical or spiritual ground in 
blocking it because it does not entirely concur with his 
own beliefs. Yet this is precisely what some cor- 
porations do to-day. 

The very least that any employer can do is to point 
out mistakes in an honest study of his plant, and the 
very least that he can refrain from doing is to hurl 
dangerous and questionable epithets at the investiga- 
tor. After all, his greatest opportunity to express 
Christianity lies in the concrete tasks of business life, 
for there he touches the greatest number of human 
lives. He should welcome sincere investigations, no 
matter how far they may disagree with his own ideas. 

From a democratic as well as a Christian point of 
View, it seems obvious that every minister should 
have the right to express his honest and considered 
opinions about concrete evidences of selfishness, 
greed, injustice, and inhumanity in the business world 
as he sees them, without having it affect his tenure 
or promotion. Woodrow Wilson and Theodore 
Roosevelt tell us of constant accusations of socialism 
or of deficiencies in good judgment hurled at them. 
Time has proved to the world that the first charge 
was totally false, and by and large their good judg- 
ment was suflicient to rank both among the relatively 
few great Presidents of the United States. If these 


What the Church Expects 371 


terms were applied to our greatest national executives, 
is it any wonder that they are cast at the minister who 
attempts to use his prophetic office to denounce in- 
justice? Is it too much to ask that business men use 
some degree of intelligence in the labels which they 
apply to men who are sincerely fighting for what 
they believe to be right? 

The Federal Council of Churches and many re- 
ligious denominations have gone on record as recog- 
nizing that labor organization is fundamentally right 
and jin accord with the principle of democracy and 
Christianity itself. This is not to say that individual 
laboring men or individual unions may not do things 
that are fundamentally wrong, just as individual 
business men, or even individual ministers and 
churches on rare occasions, have sometimes. Chris- 
tianity asks that business men always distinguish be- 
tween conduct which is wrong and organization which 
is right. In opposing unjust conduct on the part of 
laboring men, they must not make the fundamental 
mistake of opposing union organization. 

Chief Justice Taft of the United States Supreme 
Court said in a recent decision: 


Labor-unions . . . were organized out of the necessities 
of the situation. A single employee was helpless in dealing 
with an employer. He was dependent ordinarily on his 
daily wage for the maintenance of himself and his family. 
If the employer refused to pay him the wages that he 
thought fair, he was nevertheless unable to leave the em- 
ploy and to resist arbitrary and unfair treatment. Union 


372 Business and the Church 


was essential to give laborers opportunity to deal on equality 
with their employer. 


The recent United States Coal Commission found 
that it was the union which had been the potent force 
in improving the conditions of the miners. 

Roosevelt, in his autobiography, gives it as the 
growing conviction of a lifetime that the trade-union 
is “one of the greatest possible agencies” in the attain- 
ment of true political democracy in the United 
States: 


It is growing constantly in wisdom as well as in power, 
and is becoming one of the most efficient agencies towards 
the solution of our industrial problems, the elimination of 
poverty and of industrial disease and accidents, the lessening 
of unemployment, the achievement of industrial democracy 
and the attainment of a larger measure of social and indus- 
trial justice. If I were a factory employee, a workman on 
the railroads or a wage-earner of any sort, I would un- 
doubtedly join the union of my trade.* 


The minister has a part to play in aiding the spread 
of this beneficent organization. If the local leader- 
ship in the trade-union is bad, then the minister has 
an opportunity to try to make it better; if its practice 
is wrong, then he can help to eliminate the injustice. 
But in doing either of these things he must always 
see to it that the results of his activity do not weaken 
the organization, but rather that in actual fact he 
strengthens it wherever and whenever he can. No 

“Theodore Roosevelt, An Autobiography, pp. 480-481. 


What the Church Expects 373 


one would ever think of taking steps to disorganize 
and destroy the public schools if the local principal 
were bad or the teachers poor; instead, the loyal 
citizen would recognize his duty to improve and 
strengthen the educational organization of the com- 
munity. Christian ethics places upon the Christian 
business man the obligation to use similar loyalty and 
intelligence toward an organization vitally concerned 
with human rights, the labor-union. 

Not only does the church expect the business man 
to encourage unionism of the finest type; it expects 
him to think his way through to an industrial and 
social standard and to have a sensitive conscience in 
the matter of its violation. At least three hundred 
trade associations have formulated business codes of 
ethics. A considerable number even go so far as to 
mention the Golden Rule. While no one knows how 
far these standards are observed, the mere fact of 
their adoption is significant. Besides codes for par- 
ticular industries, some of our churches have adopted 
more comprehensive social creeds. The Congrega- 
tional Church is the most recent denomination to 
formulate such a code, which is probably the most 
progressive and comprehensive social statement that 
has ever been adopted by a modern religious denom- 

°Rotary International, Codes of Standards of Correct Practice, 
Chicago, 1925; J. G. Frederick, Book of Business Standards, re- 
vised edition, Commercial Standards Council, 1925; E. L. Heer- 
mance, Codes of Ethics, A Handbook, Free Press Printing Co., 
Burlington, Vt., 1924; Annals of Amer. Acad. of Political and 


Social Science, May 1922, “The Ethics of the Professions and of 
Business.” 


374 Business and the Church 


ination. It is significant that it was drawn up by the 
Social Service Commission of the denomination under 
the chairmanship of a nationally known business 
leader, Mr. John Calder, and with the full approval 
of another prominent business executive of Boston, 
Mr. Henry P. Kendall. The document is printed in 
full at the close of this chapter and deserves to be 
studied carefully by every business man in order to 
determine how far his own practice conforms with the 
standards there set forth. Is it too much to expect 
that the propertied men of America should unite con- 
science and responsibility with their ownership? 

Finally, Christ would transform every business 
man into an experimental pioneer in creative good 
will. As Washington Gladden once so fittingly ex- 
pressed it: 


The man who can gather men about him in some pro- 
ductive industry and can thus enable them by their own 
labor to earn a decent livelihood, and can fill all his relations 
with them with the spirit of Christ, making it plain to 
them that he is studying to befriend them and help them in 
every possible way, is doing quite as much, I think, to realize 
God’s purpose with respect to property and to bring heaven 
to earth, as if he were founding an asylum or endowing a 
tract society. 


But no man can really do this without experiment- 
ing in new and better methods of industrial rela- 
tions. Contentedly to stand still is to be selfish and 


What the Church Expects 375 


unchristian. Roosevelt saw this very clearly when he 
said: 


I have always maintained that our worst revolutionaries 
to-day are those reactionaries who do not see and will not 
admit that there is any need for change... . If these 
reactionaries had lived at an earlier time in our history, they 
would have advocated Sedition Laws, opposed free speech 
and free assembly, and voted against free schools, free 
access by settlers to the public lands, mechanics’ lien laws 

. and they are the men to-day who oppose minimum 
wage laws, insurance of workmen against the ills of indus- 
trial life and the reform of our legislators and our courts, 
which can alone render such measures possible. 


That there are large numbers of business men who 
are doing experimental pioneering for the public 
good, no one who has thoughtfully read through this 
present volume can for a single moment doubt. The 
church pleads for an ever larger and larger number. 
As these words are being written, a president of a 
substantial and growing manufacturing concern in 
the Middle West has come on to discuss the problem 
of how he can really translate the Jesus way of life 
into the pattern of his corporate business enterprise. 
An afternoon of consideration revolved about such 
questions as: How much profit am I entitled to 
make? Where do the claims of the consumer come 
in? Am J entitled to wait until I am doing an an- 
nual business of two million dollars before sharing 


376 Business and the Church 


profits equally with the workers? Should I install 
unemployment insurance and give it a priority. claim 
over dividends on preferred stock? At what point 
should I permit workers who purchase stock to take 
over the business? 

These are absorbing questions. The church does 
not pretend to answer them all, but it does maintain 
that the Christian employer must ask and answer 
them sincerely and unselfishly. We need more co- 
Sperative experiments between capital and the labor- 
union, of which the one on the Baltimore & Ohio 
Railroad is one example, that in the garment trades 
another. There should be hundreds of others. The 
writer has purposely not stressed the notable achieve- 
ments in good will now being carried on by such 
leaders; in the preceding chapters they have spoken 
for themselves. 

Should not all business executives take the attitude 
toward experimental pioneering which is expressed 
by A. J. Todd, the manager of the industrial re- 
lations of B. Kuppenheimer & Company. 


I believe that industrial management does not satisfy its 
full ethical responsibility unless and until it gives intelli- 
gent support to labor’s attempt to educate itself through the 
codperative movement, through its ventures in banking, and 
throught its experiments in adult education. 


The church does not claim infallibility in pro- 
claiming the Christian way; as a human agency it 


( 
if 
t 
+ 
a 


What the Church Expects 377 


may make mistakes, just as business men themselves 
are prone to do. It believes that it is better to err 
on the side of being too prophetic than on that of not 
being prophetic enough. It insists and will keep 
reiterating that men must not take the name of Christ 
unless they are willing to pay the price of Christ. 
They must not proclaim a Christianity which they 
are unwilling to practise. On the contrary, they 
must take time to discover how other sincere business 
men have begun to Christianize industry; they must 
be open-minded to what is experimental pioneering in 
creative good will; and above all they must really 
seek to place human rights above property rights. 


A STATEMENT OF SocIAL IDEALS 


Adopted by the National Council of the Congregational 
Churches, 1925 


We believe in making the social and spiritual ideals of 
Jesus our test for community as well as for individual life; 
in strengthening and deepening the inner personal relation- 
ship of the individual with God, and recognizing his obliga- 
tion and duty to society. This is crystallized in the two 
commandments of Jesus: “Love thy God and love thy 
neighbor”? We believe this pattern ideal for a Christian 
social order involves the recognition of the sacredness of 
life, the supreme worth of each single personality, and our 
common’ membership in one another—the brotherhood of 
all. In short, it means creative activity in codperation with 
our fellow human beings, and with God, in the every-day 


378 


Business and the Church 


life of society and in the development of a new and better 
world social order. ‘Translating this ideal 


(1) 
(2) 


(3) 


(4) 


(5) 


(6) 


(7) 


I. Into Education means: 


The building of a social order in which every child 
has the best opportunity for development. 

Adequate and equal educational opportunity for all, 
with the possibility of extended training for those 
competent. 

A thorough and scientific program of religious and 
secular education designed to Christianize everyday 
life and conduct. 

Conservation of health, including careful instruc- 
tion in sex hygiene and home building, abundant 
and wholesome recreation facilities, and education 
for leisure, including a nation-wide system of adult 
education. 

Insistence on constitutional rights and duties, in- 
cluding freedom of speech, of the press, and of 
peaceable assemblage. 

Constructive education and Christian care of de- 
pendents, defectives, and delinquents, in order to 
restore them to normal life whenever possible, with 
kindly segregation for those who are hopelessly 
feeble-minded. (This means that such institutions 
as the jails, prisons, and orphan asylums should be 
so conducted as to be genuine centers for education 
and health.) 

A scientifically planned program of international 
education promoting peace and good will and expos- 
ing the evils of war, intoxicants, illiteracy, and 
other social sins. 


What the Church Expects 370 


II. Into Industry and Economic Relationships means: 


(1) A reciprocity of service—that group interests, 
whether of labor or capital, must always be inte- 
grated with the welfare of society as a whole, and 
that society in its turn must insure justice to each 
group. 

(2) A frank abandonment of all efforts to secure some= 
thing for nothing, and recognition that all owner- 
ship is a social trust involving Christian administra-= 
tion for the good of all and that the unlimited 
exercise of the right of private ownership is socially 
undesirable.® 

(3) Abolishing child labor and establishing standards for 
the employment of minors which will insure maxi- 
mum physical, intellectual, and moral development. 

(4) Freedom from employment one day in seven, the 
eight-hour day as the present maximum for all in- 
dustrial workers. 

(5) Providing safe and sanitary industrial conditions 
especially protecting women; adequate accident, 
sickness, and unemployment insurance, together 
with suitable provision for old age. 

(6) An effective national system of public employment 
bureaus to make possible the proper distribution of 
the labor forces of America. 

(7) That the first charge upon industry should be a 

* As proposed to the church for adoption, this read: “A frank 
abandonment of all efforts to secure income, or any reward, which 
does not come from a real service, and recognition that all owner- 
ship is a social trust involving Christian administration for the 


good of all and that the unlimited exercise of the right of private 
ownership is socially undesirable.” 


380 


(8) 


(9) 


(10) 


(11) 


(1) 


(2) 


(3) 


(4) 


Business and the Church 


minimum comfort wage and that all labor should 
give an honest day’s work for an honest day’s pay. 
Adequate provision for impartial investigation and 
publicity, conciliation and arbitration in industrial 
disputes. 

The right of labor to organize with representatives 
of its own choosing and, where able, to share in the 
management. 

Encouragement of the organization of consumers’ 
codperatives for the more equitable distribution of 
the essentials of life. 

The supremacy of the service, rather than the profit 
motive in the acquisition and use of property on 
the part of both labor and capital, and the most 
equitable division of the product of industry that 
can be devised. 


II. Into Agriculture means: 


That the farmer shall have access to the land he 
works, on such terms as will insure him personal 
freedom and economic encouragement, while so- 
ciety is amply protected by efficient production and 
conservation of fertility. 

That the cost of market distribution from farmer to 
consumer shall be cut to the lowest possible terms, 
both farmers and consumers sharing in these 
economies. 

That there shall be every encouragement to the 
organization of farmers for economic ends, par- 
ticularly for codperative sales and purchases. 

That an efficient system of both vocational and 


(5) 


(6) 


(7) 


(1) 


(2) 


(3) 


(4+) 


(1) 


What the Church Expects 381 


general education of youths and adults living on 
farms shall be available. 

That special efforts shall be made to insure the far- 
mer adequate social institutions, including the 
church, the school, the library, means of recreation, 
good local government, and particularly the best 
possible farm home. 

That there shall be a widespread development of 
organized rural communities, thoroughly demo- 
cratic, completely codperative, and possessed with 
the spirit of the common welfare. 

That there shall be the fullest measure of friendly 
reciprocal codperation between the rural and city 
workers. 


IV. Into Racial Relations means: 
The practice of the American principle of the same 
protection and rights for all races who share our 
common life. 
The elimination of racial discrimination, and 
substitution of full brotherly treatment for all races 
in America. 
The fullest codperation between the churches of 
various races, even though of different denomi- 
nations. 
Educational and social equipment for the special 
needs of immigrants, with government information 
bureaus. 


V. Into International Relations means: 
The removal of every unjust barrier of trade, color, 


creed, and race, and the practice of equal justice for 
all nations. 


382 Business and the Church 


(2) The administration of the property and privileges 
within each country so that they will be of the 
greatest benefit not only to that nation but to all 
the world. 

(3) Discouragement of all propaganda tending to mis- 
lead peoples in their international relations or to 
create prejudice. 

(4) The replacement of selfish imperialism by such dis- 
interested treatment of backward nations as to con- 
tribute the maximum to the welfare of each nation 
and of all the world. 

(5) The abolition of military armaments by all nations 
except for an internal police force. 

(6) That the church of Christ as an institution should 
not be used as an instrument or an agency in the 
support of war. 

(7) A permanent association of the nations for world 
peace and good will, the outlawry of war,and the 
settling of all differences between nations by con- 
ference, arbitration, or by an international court. 


We believe it is the duty of every church to investigate 
local moral and economic conditions as well as to know 
world needs. We believe that it is only as our churches 
themselves follow the example and spirit of Jesus in the 
fullest sense—translating these social ideals into the daily 
life of the church and the community—that we can ever 
hope to build the Kingdom of God on earth. 

These affirmations we make as Christians and loyal citi- 
zens of our beloved country. We present them as an ex~- 
pression of our faith and patriotism. We urged upon all 
our citizens the support of our cherished institutions, faith- 


What the Church Expects 383 


fulness at the ballot, respect for law, and loyal support of 
its administrators. We believe that our country can and 
will make a great contribution to the realization of Chris- 
tian ideals throughout the world. 


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